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Summary
The United States recognized the independence of Armenia, Azerbaijan, and Georgia when the
former Soviet Union broke up at the end of 1991. The United States has fostered these states ties
with the West in part to end their dependence on Russia for trade, security, and other relations.
The United States has pursued close ties with Armenia to encourage its democratization and
because of concerns by Armenian Americans and others over its fate. Close ties with Georgia
have evolved from U.S. contacts with its pro-Western leadership. Successive Administrations
have supported U.S. private investment in Azerbaijans energy sector as a means of increasing the
diversity of world energy suppliers. The United States has been active in diplomatic efforts to
resolve regional conflicts in the region. As part of U.S. global counter-terrorism efforts, the U.S.
military in 2002 began providing equipment and training for Georgias military and security
forces. Troops from all three regional states have participated in stabilization efforts in
Afghanistan and Iraq. The regional states also have granted transit privileges for U.S. military
personnel and equipment bound to and from Afghanistan.
Beginning on August 7, 2008, Russia and Georgia warred over Georgias breakaway regions of
Abkhazia and South Ossetia. Russian troops quickly swept into Georgia, destroyed infrastructure,
and tightened their de facto control over the breakaway regions before a ceasefire was concluded
on August 15. The conflict has had long-term effects on security dynamics in the region and
beyond. Russia recognized the independence of Abkhazia and South Ossetia, but the United
States and nearly all other nations have refused to follow suit. Russia established military bases in
Abkhazia and South Ossetiain violation of the ceasefire accordsthat buttress its long-time
security presence in Armenia. Although there were some concerns that the South Caucasus had
become less stable as a source and transit area for oil and gas, Kazakhstan and Turkmenistan are
barging oil across the Caspian Sea for transit westward. Also, the United States and the European
Union still support building more east-west pipelines through Turkey to bring Azerbaijani and
perhaps other gas to European markets.
Issues of concern in the 113th Congress regarding the South Caucasus may include Armenias
independence and economic development; Azerbaijans energy development; and Georgias
recovery from Russias August 2008 military incursion. At the same time, concerns have been
raised about the status of human rights and democratization in the countries; the ongoing
Armenia-Azerbaijan conflict over the breakaway Nagorno Karabakh region; and ongoing threats
posed to Georgia and the international order by Russias 2008 incursion and its diplomatic
recognition of South Ossetia and Abkhazia. Congress has continued to oversee the regions role
as part of the Northern Distribution Network for the transit of U.S. and NATO military supplies to
and from Afghanistan. Georgias aspirations for NATO membership have received ongoing
congressional support. Many Members of Congress have evinced interest in recent political
trends in Georgia following the peaceful transfer of party control in the October 2012 legislative
election and in the wake of an October 2013 presidential election.
Some Members of Congress and other policy makers believe that the United States should
provide greater support for the regions increasing role as an east-west trade and security corridor
linking the Black Sea and Caspian Sea regions, and for Armenias inclusion in such links. They
urge greater U.S. aid and conflict resolution efforts to contain warfare, crime, smuggling, and
terrorism, and to bolster the independence of the states. Others urge caution in adopting policies
that will increase U.S. involvement in a region beset by ethnic and civil conflicts.
Contents
Most Recent Developments ............................................................................................................. 1
Background ...................................................................................................................................... 2
Overview of U.S. Policy Concerns .................................................................................................. 2
Regional Responses after the September 11, 2001, Terrorist Attacks on the United
States ................................................................................................................................ 5
Regional Support for Military Operations in Iraq and Afghanistan .................................... 5
The South Caucasus and the Northern Distribution Network (NDN) ................................. 6
U.S. Policy after the August 2008 Russia-Georgia Conflict ............................................... 7
The External Security Context of the South Caucasus .................................................................... 9
Russian Involvement in the Region ........................................................................................... 9
Military-Strategic Interests .................................................................................................. 9
Economic Interests ............................................................................................................ 13
The Roles of Turkey, Iran, and Others..................................................................................... 14
The Armenia-Turkey Protocols of 2009 ............................................................................ 14
Iran .................................................................................................................................... 15
Other Countries ................................................................................................................. 17
Obstacles to Peace and Independence ........................................................................................... 17
Regional Tensions and Conflicts ............................................................................................. 17
Nagorno Karabakh Conflict .............................................................................................. 19
Civil and Ethnic Conflict in Georgia ................................................................................. 24
Economic Conditions, Blockades, and Stoppages ................................................................... 30
Recent Democratization Problems and Progress ..................................................................... 33
Political Developments in Armenia................................................................................... 34
Political Developments in Azerbaijan ............................................................................... 37
Political Developments in Georgia.................................................................................... 39
U.S. Aid Overview ......................................................................................................................... 42
The Millennium Challenge Account........................................................................................ 43
U.S. Security Assistance .......................................................................................................... 44
Security Assistance to Georgia since the August 2008 Conflict ....................................... 46
The Regional States and NATO ........................................................................................ 49
U.S. Trade and Investment ............................................................................................................. 52
Energy Resources and U.S. Policy .......................................................................................... 53
Building the Baku-Tbilisi-Ceyhan and South Caucasus Pipelines.................................... 54
Other Export Pipeline Proposals ....................................................................................... 55
Azerbaijans Announcement of a Gas Pipeline to Europe................................................. 57
Discussions on a Trans-Caspian Pipeline .......................................................................... 59
Regional Energy Cooperation with Iran ............................................................................ 60
113th Congress Legislation ............................................................................................................. 60
Figures
Figure 1. Map of Caucasus Region ................................................................................................ 66
Tables
Table 1. U.S. Trade Turnover, 2013 ............................................................................................... 53
Table 2. U.S. Foreign Assistance to the South Caucasus States, FY1992 to FY2014 ................... 62
Table 3. U.S. Assistance to the South Caucasus by Year, FY1992-FY2001 .................................. 64
Table 4. U.S. Assistance to the South Caucasus by Year, FY2002-FY2010 (and Totals,
FY1992-FY2010) ....................................................................................................................... 64
Table 5. U.S. Budgeted Humanitarian Assistance to Nagorno Karabakh Provided by the
U.S. Agency for International Development and Other Agencies, FY1998-FY2012 ................ 65
Contacts
Author Contact Information........................................................................................................... 66
U.N. General Assembly, Department of Public Information, General Assembly Adopts Resolution Calling upon States
Not to Recognize Changes in Status of Crimea Region, GA/11493, March 27, 2014; Louis Charbonneau, Russia
Threatened Countries Ahead of U.N. Vote on Ukraine Envoys, Reuters, March 28, 2014.
2
The White House, Office of the Vice President, Readout of Vice President Bidens Meeting with Prime Minister Irakli
Garibashvili of Georgia, February 24, 2014.
3
U.S. Department of State, Office of the Spokesperson, Joint Statement Following the U.S.-Georgia Strategic
(continued...)
Background
Armenia, Azerbaijan, and Georgia are located south of the Caucasus Mountains that form part of
Russias borders (see Figure 1). The South Caucasus states served historically as a north-south
and east-west trade and transport land bridge linking Europe to the Middle East and Asia, over
which the Russian Empire and others at various times endeavored to gain control. In ancient as
well as more recent times, oil and natural gas resources in Azerbaijan attracted outside interest.
The regional peoples can point to periods of past autonomy or self-government. After the Russian
Empire collapsed in 1917, all three states declared independence, but by early 1921 all had been
re-conquered by Russias Red (Communist) Army. They regained independence when the Soviet
Union collapsed at the end of 1991.4
proliferation and disarmament activities, until the President determines that Azerbaijan has taken
demonstrable steps to cease all blockades and other offensive uses of force against Armenia and
NK. Provisions in FY1996, FY1998, and FY1999 legislation eased the prohibition by providing
for humanitarian, democratization, and business aid exemptions. In 2002, waiver authority was
enacted (see below, Regional Responses after the September 11).
Some observers argue that developments in the South Caucasus are largely marginal to U.S.
strategic interests. They urge great caution in adopting policies that will heavily involve the
United States in a region beset by ethnic and civil conflicts, and some argue that, since the
European Union has recognized the region as part of its neighborhood, it rightfully should play
a major role. Some observers argue that the U.S. interest in democratization and human rights
should not be subordinated to interests in energy and anti-terrorism.5
Other observers believe that the United States should be more actively engaged in the region.
They urge greater U.S. aid and conflict resolution efforts to contain warfare, crime, smuggling,
and Islamic extremism and to bolster the independence of the states. Some argue that such
enhanced U.S. relations also would serve to contain Russian and Iranian influence and that
close U.S. ties with Azerbaijan could benefit U.S. relations with other Islamic countries. They
also point to the prompt support offered to the United States by the regional states in the
aftermath of the September 11, 2001, attacks by Al Qaeda on the United States. Some argue that
energy resources in the Caspian region are a central U.S. strategic interest, because Azerbaijani
and Central Asian oil and natural gas deliveries could somewhat lessen Western energy
dependency on Russia and the Middle East (see below, Economic Interests).
In his annual worldwide threat assessment, Director of National Intelligence James Clapper
testified in late January 2014 that Georgias new president and prime minister face challenges
from a declining economy. Also, the prosecution of former government officials threatens to
further polarize politics. While tensions with Russia have eased, reducing the threat of conflict,
core disputes, including the status of Georgias breakaway South Ossetia and Abkhazia, remain
unlikely to be resolved. He assessed the chance of renewed Armenian-Azerbaijani conflict over
the breakaway NK as low, but also viewed the prospects for a peace settlement as dim. Azerbaijan
is continuing to build up its military forces to give it a decisive advantage, and Armenia has a
strong interest in maintaining the status quo, since ethnic Armenians control NK and surrounding
territories. He cautioned, however, that a miscalculation could occur (perhaps implying renewed
conflict), given the close proximity of military forces and the frequency of ceasefire violations.6
The United States has endeavored to reassure Azerbaijan that it continues to be a strategic
partner in counter-terrorism cooperation and energy security and has appeared to balance these
U.S. interests against its concerns about democratization in Azerbaijan. According to some
observers, relations between the United States and Azerbaijan had cooled after the Administration
supported efforts in 2009-2010 by Armenia and Turkey to improve relations that Azerbaijan
opposed (see below, The Armenia-Turkey Protocols of 2009) and after President Aliyev was
5
U.S. House of Representatives. Committee on Foreign Relations. Subcommittee on International Organizations,
Human Rights, and Oversight. Ideals vs. Reality in Human Rights and U.S. Foreign Policy: The Cases of Azerbaijan,
Cuba, and Egypt, July 12, 2007; U.S. Commission on Security and Cooperation in Europe. Energy and Democracy,
July 23, 2007.
6
U.S. Senate, Select Committee on Intelligence, Hearing on World Wide Threats, Statement for the Record:
Worldwide Threat Assessment of the U.S. Intelligence Community, James R. Clapper, Director of National Intelligence,
January 29, 2014.
not invited to the U.S. Nuclear Security Summit in April 2010. Also, according to this view,
Azerbaijan may have pursued closer working relations with Russia in the wake of the August
2008 Russia-Georgia conflict, which showed that Russia remained a major power in the region.
While Azerbaijan may have followed such policies, it continued troop support for NATO
operations in Afghanistan (see below, Regional Support for Military Operations in Iraq and
Afghanistan) and played a significant role as part of the Northern Distribution Network for the
transit of U.S. and NATO supplies to and from Afghanistan. Also, Azerbaijan continued to plan to
step up gas supplies to Europe.
To reassure Azerbaijan that the Administration viewed U.S.-Azerbaijan relations as strategically
significant, then-Secretary of Defense Robert Gates visited Azerbaijan in June 2010 and thenSecretary of State Hillary Clinton visited in July 2010, and President Obama met with President
Aliyev on the sidelines of the U.N. General Assembly in September 2010. In April 2012, the
Obama Administration re-launched meetings of the U.S.-Azerbaijan Intergovernmental
Commission on Economic Cooperation, which had last convened in 2008. During her June 6,
2012, visit to Azerbaijan, then-Secretary Clinton thanked Azerbaijan for its essential role in the
transit of personnel and supplies to Afghanistan, and its central role in Europes efforts to
diversify sources of energy and transport routes. However, she also called for further
democratization and for the release of individuals detained for expressing their views in print or
on the streets.7
The Senate Foreign Relations Committee held a confirmation hearing for ambassador-designate
to Azerbaijan Richard Morningstar on June 13, 2012. He testified that the wide range of shared
interests between the United States and Azerbaijan intersects with many of the United States
highest foreign policy priorities. He outlined three core areas of importance to the relationship:
security, energy, and democratic and economic reform, and stressed that the Administration
believes we must intensify our cooperation in these areas. He also warned that security and
prosperity in the South Caucasus could only be assured by the peaceful settlement of the NK
conflict, and he pledged to, if confirmed, support the efforts of the Minsk Group.8 He was
confirmed by the Senate at the end of June 2012 and presented his credentials to President Aliyev
in September 2012.
Meeting with visiting Azerbaijani Foreign Minister Elmar Mammadyarov in June 2013, Secretary
Kerry praised Azerbaijan as an important partner in Afghanistan, in facilitating shipments along
the Northern Distribution Network, and in backing the Southern Corridor for gas transit to
Europe. He and Foreign Minister Mammadyarov indicated that the two sides would discuss the
NK conflict, and Secretary Kerry voiced the hope that movement toward a peace settlement could
be revitalized. Secretary Kerry also urged Azerbaijan to continue democratization as one
component of regional peace. Foreign Minister Mammadyarov also termed the U.S.-Azerbaijani
relationship a strategic partnership, and voiced the hope that although his country was far from
the United States geographically, the two nations would continue to cooperate on these issues.9
U.S. Department of State, Remarks With Azerbaijani Foreign Minister Elmar Mammadyarov, June 6, 2012.
U.S. Senate, Committee on Foreign Relations, Statement of Richard Morningstar, Ambassador-Designate to
Azerbaijan, June 13, 2012.
9
U.S. Department of State, Remarks With Azerbaijani Foreign Minister Elmar Mammadyarov Before Their Meeting,
June 3, 2013.
8
There were some Azerbaijani media reports that U.S.-Azerbaijani relations were somewhat
strained during the period before the Azerbaijani presidential election, allegedly linked to U.S.
concerns voiced about campaign problems.10 After President Aliyevs inauguration on October
19, 2013, to a third presidential term, Ambassador Morningstar called for expanding and
deepening U.S.-Azerbaijani cooperation on many shared critical interests, including efforts to
resolve the NK conflict and to bolster regional security, counter-terrorism, energy security, and
economic diversification. He also stated that the United States would continue to work with the
government and civil society to promote democratic values and principles in Azerbaijan.11
Regional Responses after the September 11, 2001, Terrorist Attacks on the
United States
In the wake of the September 11, 2001, terrorist attacks in New York and Washington, DC, the
former Bush Administration obtained quick pledges from the three South Caucasian states to
support Operation Enduring Freedom (OEF) in Afghanistan, including overflight rights and
Azerbaijans and Georgias offers of airbase and other support. Congressional attitudes toward
Azerbaijan and Section 907 shifted, resulting in presidential waiver authority being incorporated
into Foreign Operations Appropriations for FY2002 (H.R. 2506; P.L. 107-115). The President
may use the waiver authority if he certifies that U.S. aid supports U.S. counter-terrorism efforts,
supports the operational readiness of the Armed Forces, is important for Azerbaijans border
security, and will not harm NK peace talks or be used for offensive purposes against Armenia.
The waiver may be renewed annually, and 60 days after the exercise of the waiver, the President
must report to Congress on the nature of aid to be provided to Azerbaijan, the military balance
between Armenia and Azerbaijan and the effects of U.S. aid on that balance, the status of
Armenia-Azerbaijan peace talks, and the effects of U.S. aid on those talks. The waiver authority
has been exercised annually.
10
2014. Azerbaijan has pledged aid to help Afghanistan build up its security forces
and to provide other support for Afghanistan after 2014.
On November 16, 2009, Georgia sent 173 troops for training in Germany before
their scheduled deployment at the end of March 2010 to support ISAF. These
troops were boosted to 925 in mid-2010. On December 20, 2011, the Georgian
legislature approved sending an added Georgian battalion of 749 troops to
Afghanistan. The troops were deployed in October 2012, bringing the contingent
to some 1,560 troops. The added deployment made Georgia the largest
contributor to ISAF among non-NATO member countries (currently the country
is by far the largest such contributor). The U.S. European Commands Georgia
Deployment Program supports Georgian troop training and rotations. The
Georgian government reportedly has indicated that it will maintain a substantial
troop presence through the end of 2014.
In January 2010, Armenia sent 40 troops for training in Germany before their
deployment to Kunduz, Afghanistan, to serve with German forces. The number
of troops was increased to 45 at the end of 2010. ISAF reported that the
Armenian contingent numbered 121 in mid-January 2014.
12
Zaur Shiriyev, NATO and the South Caucasus: The Impact of the Northern Distribution Network, in Andris
Sprds and Dina Potjomkina, eds., Northern Distribution Network: Redefining Partnerships within NATO and
Beyond, Riga: Latvian Institute of International Affairs, 2013, pp. 135-168.
13
U.S. Embassy, Baku, Azerbaijan, Speech to Plenary Session for Caspian Oil and Gas Show 2011 Ambassador
Matthew Bryza, June 8, 2011; Ambassador Matthew Bryza, Press Conference, December 29, 2011.
14
U.S. Embassy, Tbilisi, Ambassador Norland and General Fraser visit Poi Port, July 27, 2013.
for shipments through Pakistan, and observers also have pointed to problems with Uzbekistan as
contributing to the slowdown in NDN traffic.
In the security realm, the United States and Georgia intend to expand the scope of their
ongoing defense and security cooperation programs to defeat [threats to global peace and
stability] and to promote peace and stability. Such cooperation will increase Georgian
capabilities and ... strengthen Georgias candidacy for NATO membership.
In the economic realm, the two countries intend to pursue an Enhanced Bilateral
Investment Treaty, to expand Georgian access to the General System of Preferences, and
to explore the possibility of a Free-Trade Agreement. Energy security goals include
increasing Georgias energy production, enhanc[ing] energy efficiency, and increas[ing]
the physical security of energy transit through Georgia to European markets.
Then-Deputy Assistant Secretary of State Matthew Bryza stressed that the charter did not provide
security guarantees to Georgia. According to some observers, the Charter aimed to reaffirm the
United States high strategic interest in Georgias fate, to counter perceptions that the United
States (and the West) had acquiesced to increased Russian dominance in the South Caucasus.16
Some in Georgia expressed concern that the reset in U.S.-Russian relations enunciated by the
Obama Administration in 2009 could lead the United States to downgrade ties with Tbilisi, or
even make concessions to Russia at Georgias expense. At the U.S.-Russia summit in July 2009,
however, President Obama stated that one area where the two presidents agreed to disagree was
on Georgia, where he stressed that he had reiterated my firm belief that Georgias sovereignty
and territorial integrity must be respected.17
Among recent high-level U.S.-Georgia bilateral visits, President Obama met with visiting thenPresident Saakashvili in January 2012. President Obama praised efforts in Georgia to increase the
honesty of police, the rule of law, and free market reforms, and called for free elections in the
future. He reiterated the call in the Charter for exploring a free trade agreement, and thanked
Saakashvili for Georgias troop contributions in Afghanistan. He mentioned in a press conference
15
that the two presidents had discussed strengthen[ing] our defense cooperation, and he voiced
continuing support for Georgias NATO aspirations.18 Russias then-Prime Minister Putin and
others in Russia denounced what they inferred was a change in U.S.-Georgia defense ties,
although the Administration claimed that its defense cooperation policy toward Georgia had not
changed (but see directly below, and below in Security Assistance to Georgia since the August
2008 Conflict).
Secretary Kerry first met with Foreign Minister Maia Panjikidze on April 24, 2013, on the
sidelines of a NATO foreign ministerial meeting in Brussels. The U.S. side issued few details.
Then-President Saakashvili visited the United States in late April-early May 2013, and met with
Vice President Biden, Secretary Kerry, and Senator John McCain, among others. Deputy
Secretary of State William Burns visited Tbilisi on July 19, 2013, and reassured Pajikidze of U.S.
support for Georgias democratic development, its Euro-Atlantic aspirations, and its sovereignty
and territorial integrity. In late August 2013, Defense Secretary Chuck Hagel and other U.S.
officials met with visiting Georgian Defense Minister Irakli Alasania. Reportedly, Alasania
discussed Georgias defense needs, but little information was available about the U.S. response.19
Commenting on then-President Saakashvilis U.N. General Assembly speech in September 2013,
U.S. Ambassador to Georgia Richard Norland underlined U.S. concerns about Russias
construction of barriers along Abkhazias and South Ossetias borders, and praised Saakashvilis
admission that some human rights problems had occurred during his presidency. Norland also
stressed that the United States would continue to support the enhancement of the rule of law in
Georgia.20
Some observers have called for a reevaluation of some aspects of U.S. support for Georgia. They
have raised concerns that although the 2012 legislative and 2013 presidential elections were
progressive, the arrests of former government officials highlight problems of democratization.
They have asserted that U.S. acceptance of Georgian troops for coalition operations in
Afghanistan should not lead to U.S. defense commitments to Georgia, and a few have suggested
that the United States should not unquestionably back Georgias territorial integrity, but should
rather encourage reconciliation and the consideration of options short of the near-term
reintegration of the regions into Georgia. In contrast, other observers have argued that there were
problems of democratization and respect for human rights during Saakashvilis rule as well as
under the present government, and that the United States should step up political and economic
assistance to Georgia. They also have called for a more robust U.S. and NATO effort to resupply
Georgia with defensive weaponry so that it might deter or resist Russian aggression (see also
below, U.S. Security Assistance). At the same time, most observers advise against extending
diplomatic recognition to the breakaway regions without an international consensus.21
18
The White House, Office of the Press Secretary, Remarks by President Obama and President Saakashvili of Georgia
After Bilateral Meeting, January 30, 2012.
19
U.S. Department of Defense, Office of the Assistant Secretary of Defense (Public Affairs), News Release: Readout of
Secretary Hagels Meeting With Georgias Minister of Defense Irakli Alasania, August 21, 2013; Joshua Kucera,
Alasania, in Washington, Lays Out More Modest Agenda for Georgia, Eurasianet, August 22, 2013.
20
U.S. Embassy, Tbilisi, Ambassadors Comments on Presidents UNGA Speech, September 26, 2013.
21
Thomas de Waal, Georgia after the Titans, The National Interest, December 4, 2013.
Military-Strategic Interests
Russias armed presence in the South Caucasus has been multifaceted, including thousands of
military base personnel, border troops, and until 2008, peacekeepers. The first step by Russia in
maintaining a military presence in the region was the promulgation of the Commonwealth of
Independent States (CIS) Collective Security Treaty (CST) in 1992, which pledged members to
consult in the event of a threat to one or several members, and to provide mutual aid if attacked. A
follow-on Collective Security Treaty Organization (CSTO) with a charter reiterating these
pledges was established in 2002 (current members include Armenia, Belarus, Kazakhstan,
Kyrgyzstan, Russia, and Tajikistan). Russia also secured permission for two military bases in
Armenia and four in Georgia (on the latter bases, see below). The total number of Russian ground
forces troops in Armenia has been estimated at about 3,300, and an additional number of Air
Force personnel.22 In addition, Russias Federal Security Service Border Guard Directorate is
22
responsible for guarding Armenias borders with Turkey and Iran (the directorate reports that the
bulk of the guards under its direction are Armenian citizens). Various statements have appeared
by CSTO and Armenian officials about whether or not the CSTO would defend NK and Armenia
against an Azerbaijani military operation (see also below).
During a visit by then-Russian President Dmitriy Medvedev to Armenia in August 2010, Armenia
agreed to extend the basing agreement with Russia to the year 2044. In the basing accord, Russia
also pledged that its forces would help safeguard Armenias national security and that it would
supply more modern weaponry for Armenias armed forces. Although some officials in Armenia
hailed the accord as providing greater assurance that Russia would intervene if Azerbaijan began
operations against NK, Medvedev argued during a September 2010 visit to Azerbaijan that the
accord was not aimed against Azerbaijan. Georgias then-Foreign Minister Grigol Vashadze,
however, criticized the accord as strengthening Russias military influence in the region, as
compromising Armenias independence, and as raising tensions that are inimical to the settlement
of the NK conflict.23
In December 2012, President Sargisyan stated that in case of war with Azerbaijan, Armenia was
counting on the support of its allies in the CSTO, rhetorically asking why else are we in the
organization?24 In January 2013, President Sargisyan stressed in a speech at the Defense
Ministry that the strategic partnership between Armenia and Russia is the nucleus of Armenian
security, and that membership in the CSTO also is the real guarantee of Armenias security.25
One Russian newspaper reported in January 2013 that Russia recently had transformed its forces
in Armenia to primarily professional contract troops, in anticipation of possible Azerbaijani
military action against Armenia or Israeli action against Iran. The report quoted a Russian
lieutenant general as stating that whether Russia will defend Armenia from an Azerbaijani action
will be a political decision, but that the forces should be ready.26
In October 2013, the commander of Russias 102nd military base in Armenia was quoted in a
Russian Defense Ministry publication as suggesting that if Azerbaijan attacked NK, the Russian
base might respond in line with Russias obligations as part of the CSTO. Azerbaijans Defense
Minister protested to the Minsk Group, including to Russian co-chair Igor Popov, who reportedly
stated that there was a misunderstanding. Armenias Defense Ministry reportedly asserted that
the countrys membership in the CSTO assisted in preventing a potential military strike by a
third country, but also stated that Armenian forces were sufficient to repulse it without Russian
or CSTO intervention. Azerbaijani Defense Minister Zakir Hasanov reportedly raised the issue
during a Moscow visit in November 2013 with Russian Defense Minister Sergey Shoygu, who
termed the assertion distorted. In early February 2014, Armenian Defense Minister Seyran
Ohanian asserted that should the need arise, the CSTO must come to Armenias aid under the
current charter. How it will happen in reality and what role the countries, especially in Central
Asia, will play in this affair, time will tell.27
23
Azerbaijan Press Agency, September 8, 2010. See also Joshua Kucera, Armenia Boosting Relations with both
NATO and Russia, Eurasianet, November 19, 2012.
24
CEDR, December 24, 2012, Doc. No. CEP-950187.
25
Interfax, January 16, 2013.
26
CEDR, January 18, 2013, Doc. No. CEP-305001.
27
Interfax, November 4, 2013; Armenian News Agency, November 5, 2013; Interfax, November 6, 2013; Joshua
Kucera, Russian Officer: We Would Intervene In Karabakh, Eurasianet, November 1, 2013; Interfax, February 5,
2014.
10
In addition to the Russian troops in the South Caucasus, about 88,000 Russian troops are
stationed nearby in the North Caucasus, naval forces of Russias Caspian Sea Flotilla are based in
Astrakhan, and some naval forces of the Black Sea Fleet are docking at the port of Ochamchira in
Abkhazia, Georgia. In 1993, Azerbaijan was the first Eurasian state to get Russian troops to
withdraw, except at the Qabala (Gabala) radar site in northern Azerbaijan. Giving up on closing
the site, in January 2002 Azerbaijan signed a 10-year lease agreement with Russia permitting up
to 1,500 troops there. After months of reportedly contentious negotiations, during which
Azerbaijan purportedly demanded a lease increase from the present $7 million per year to $300
million, Russia announced in early December 2012 that it would relinquish the radar site. In April
2013, President Aliyev claimed that the country had asked for a higher lease payment because of
the scenic value of the land. He averred that Russia had been asked to pay market value for
leasing the land, just as Russia charges world market value for weaponry it sells to Azerbaijan. He
denied that the lease decision harmed Azerbaijani-Russian relations or that Azerbaijan had been
influenced by the United States regarding the lease negotiations.
President Putin visited Azerbaijan in mid-August 2013, leading a large delegation of ministers
and other officials. Putin hailed Azerbaijan as one of Russias long-standing, traditional, and
reliable partners, and as Russias strategic partner. Putin stressed the growth of trade relations
between the two countries, the more than 500 Russian businesses operating in Azerbaijan, and the
1 million or more Azerbaijani labor migrants in Russia. Putin emphasized energy cooperation,
and Russias Rosneft state oil firm and Socar signed an accord on oil swaps, exploration,
marketing, and other cooperation. Putin stated that the two sides had discussed security, border
delineation, and environmental protection in the Caspian Sea, and the two leaders inspected ships
from the Russian Caspian Sea Flotilla that were visiting Baku. President Aliyev stated that
cooperation with Russia in the oil and gas sphere would increase and stressed that AzerbaijaniRussian military cooperation already was substantial and would continue.
According to one report, military cooperation agreements were signed that called for arms
transfers worth at least $4 billion, technical assistance to modernize Azerbaijani defense
industries, and work to repair and upgrade Azerbaijani military hardware and weapons. Russia
agreed to provide military education for at least 100 officers and Azerbaijan allegedly agreed to
shift away from cooperation with the United States on Caspian maritime security and toward
greater maritime cooperation with Russia.28 CSTO Secretary General Nikolay Bordyuzha had
earlier statedafter media reports appeared in mid-2013 of Russian arms deliveries to
Azerbaijanthat Russia considered the impact of such transfers on the military equilibrium in the
South Caucasus, and that Russia was compensating the Armenian side for such transfers,
including by maintaining a Russian military presence which aims to ensure the safety of
Armenia. Underlining such support, Russia and Armenia signed a new treaty on military and
technological cooperation on June 25, 2013, during a visit by Russian Security Council Secretary
Nikolai Patrushev. He also stressed that Russia had deployed enough forces and means [in
Armenia] to guarantee Armenias security.29
After the September 11, 2001, terrorist attacks in the United States, Russia stepped up its claims
that Georgia harbored Chechen terrorists (with links to Al Qaeda) who used Georgia as a staging
ground for attacks into Chechnya. The United States expressed unequivocal opposition to
military intervention by Russia inside Georgia. Georgia launched a policing effort in its northern
28
29
11
Pankisi Gorge in late 2002with U.S. assistancethat somewhat reduced tensions with Russia
over this issue. In April 2006, Azerbaijan convicted 16 people on charges that they had received
terrorist training from al Qaeda operatives in the Pankisi Gorge. Since 2009, Russia has renewed
its allegations that the Gorge harbors terrorists. Georgia has rejected these allegations as false and
raised concerns that they might serve as a pretext for new Russian violations of Georgias
territorial integrity.
Some Russian and regional observers have speculated that in case of a possible U.S.-Israeli
military action against Iran, Russia would take advantage of the operation to move militarily
against the South Caucasus. Russia might quickly secure an air and land route through Georgia to
its military facilities in Armenia, and occupy the rest of the region, ostensibly to safeguard
southern Russia from Iranians fleeing into the South Caucasus or to protect against other claimed
disorder, these observers warn.30
30
Nikoloz Devdariani, Russia to Cut Military Transport Corridor Through Georgia? Georgia Today, April 13,
2012; CEDR, April 13, 2012, Doc. No. CEP-950045.
31
The Military Balance, International Institute of Strategic Studies, February 5, 2014.
12
Economic Interests
Russia plays a significant role in Armenias economy, and less in Azerbaijan and Georgia. Russia
is Armenias major foreign investor, and is responsible for about one-quarter of Armenias trade
turnover. All three states rely somewhat on remittances provided by migrant workers in Russia. A
Russian embargo on much trade with Georgia was in place from 2006 until some transactions
were resumed in 2013. Russia has opposed the conclusion of free-trade and association
agreements between the EU and Soviet successor states, including Armenia, instead pressuring
the states to forge closer economic ties with Russia.
While Georgia initialed an association and trade agreement with the EU at Vilnius in November
2013, Armenia appeared to accede to Russian influence in early September 2013 when it
announced that it would prioritize joining the Russia-led Eurasian Customs Union, seemingly
mooting its four years of talks with the EU on an association accord (see also below). President
Sargisyan explained that Armenia previously had questioned the need to join the Customs Union
because Armenia does not share borders with other members, but that the country had decided to
join in order to prevent serious problems in further deepening and expanding Armenias
economic [and] cultural ties with its strategic partner. He stressed that since Armenia was a
security partner with Russia, it could not isolate itself from economic ties. Armenian Defense
Minister Ohanyan reportedly similarly stated that Armenia decided to join the Customs Union
because of the threatening security environment faced by Armenia.32 Russian subsidies for gas
supplied to Armenia reportedly entered into the decision (see below). On September 18, 2013,
U.S. Representative Eliot Engel wrote a letter to Secretary Kerry raising concerns that Russia was
attempting to prevent Armenia and other Eurasian states from building ties with Europe.
Commenting on the pressure that Russia allegedly had applied to persuade Ukraine not to initial
an EU association agreement, Georgian Prime Minister Garibashvili stated in mid-January 2014
that Georgia was not as economically vulnerable to such pressure and would be able to conclude
and sign such an accord (perhaps by August 2014, according to some reports).
Russia has tried to play a dominant role in future oil and gas production and transportation in the
Caspian Sea region. A major lever has been the prices it charges the South Caucasian countries
for gas. In 2006, after Russia raised gas prices, Armenia agreed to relinquish various energy
assets to Russian firms as partial payment for the price increase. Some critics alleged that Russia
thereby gained virtual control over Armenias energy supply. After Russia again hiked gas prices
in 2007, Georgia negotiated an agreement to receive some Azerbaijani gas via the new South
Caucasus Pipeline (SCP, see Building the Baku-Tbilisi-Ceyhan and South Caucasus Pipelines,
below) and another small existing pipeline. Azerbaijan also announced it would no longer
purchase Russian gas. Following the August 2008 Russia-Georgia conflict, Gazproms
arrangement with Georgia involving the transit of Russian gas to Armenia remained in place.
Armenia pays a share of gas to Georgia as a transit fee. Georgia now receives more of its gas
from Azerbaijan than from Russia.
Russia greatly boosted the price of gas sold to Armenia in April 2013, as the latter considered
signing a free-trade and association agreement with the EU. Russia offered a partial subsidy in
late August, and an Armenian-Russian accord on energy security was signed during Sargisyans
September 2013 Moscow visit, where Sargisyan announced plans to join the Customs Union.
Details on subsidies for Armenia were finalized during President Putins December 2013 visit to
32
CEDR, October 15, 2013, Doc. No. CEL-51285601; September 18, 2013, Doc. No. CEL-57379774.
13
Armenia. Russia agreed to reduce the price of gasfrom $270 per 35.3 million cubic feet to
about $189 per 35.3 million cubic feetfor up to 88.3 billion cubic feet of gas per year to be
supplied to Armenia for five years. In return, Armenia agreed to transfer its remaining shares in
the Armrosgazprom gas firm to Gazprom and to give Gazprom a sole concession in Armenia until
2043. The $155 million Gazprom paid for the shares was immediately returned to satisfy part of a
$300 million gas debt. Critics charged that the gas price was still higher than that charged by
Russia for supplies to other Customs Union members, and Iran protested that it had not been
approached to sell more gas to Armenia.33
14
of the two states, to implement a dialogue on the historical dimension with the aim to restore
mutual confidence between the two nations, including an impartial scientific examination of the
historical records and archives to define existing problems and formulate recommendations, and
to undertake other cooperative efforts.35
A ruling of the Armenian constitutional court on January 18, 2010, that the protocols could not
affect Armenias policy on genocide recognition was criticized by the Turkish government as not
being in conformity with the text of the protocols. The Armenian government stated that the
ruling did not affect the conditions of the protocols. Azerbaijan strongly criticized Turkey for
moving toward normalizing relations with Armenia without formally linking such a move to a
peace settlement of the NK conflict. This criticism quickly elicited pledges by Turkeys leaders
that the Turkish legislature would not approve the protocols until there was progress in settling
the NK conflict. On April 22, 2010, the ruling Armenian party coalition issued a statement that
considering the Turkish sides refusal to fulfill the requirement to ratify the accord without
preconditions in a reasonable time, making the continuation of the ratification process in the
national parliament pointless, we consider it necessary to suspend this process.36
Perhaps reflecting the repair of Azerbaijani-Turkish ties, in August 2010, Azerbaijan and Turkey
signed a strategic partnership and mutual assistance agreement. The 10-year accord specifies that
if one of the sides is attacked by a third country, the sides will provide reciprocal aid. Other
provisions call for the sides to cooperate to eliminate threats to national security; to ban the
operation of groups threatening the independence, sovereignty, and territorial integrity of the
other side; to prevent their territories from being used for acts of aggression against the other side;
and to cooperate in defense industry production, holding joint military exercises, and training
army specialists.
Iran
Irans goals in the South Caucasus include discouraging Western powers such as Turkey and the
United States from gaining influence (Irans goal of containing Russia conflicts with its
cooperation with Russia on these interests), ending regional instability that might threaten its own
territorial integrity, and building economic links. Armenia and Georgia have through the ages
upheld their Christian heritage within the wider Islamic region (although many Georgian Ajarians
are Sunni Muslims). Azerbaijanis are mainly a Turkic people and practice Shiite Islam, as do the
bulk of Iranians, but many Azeris reject the strict Shiism of Iran and its cleric-led politics. A
major share of the worlds ethnic Azerbaijanis reside in Iran (The World Factbook estimates about
12 million, although other estimates are far higher), as well as about 200,000 Armenians. Ethnic
consciousness among some Southern Azerbaijanis in Iran has grown. Azerbaijani elites fear
Iranian-supported Islamic extremism and object to Iranian support to Armenia. Baku banned the
pro-Iranian Islamic Party of Azerbaijan (IPA) in 1995. To block the West and Azerbaijan from
developing Caspian Sea energy, Iran long has insisted on either common control by the littoral
states or the division of the seabed into five equal sectors. There is some trade between the two
countries, reportedly about $1 billion in turnover in 2013.
35
Ministry of Foreign Affairs of Armenia. Protocol on the Establishment of Diplomatic Relations between the Republic
of Armenia and the Turkish Republic and the Protocol on the Development of Mutual Relations Between the Republic
of Armenia and the Turkish Republic, August 31, 2009, at http://www.armeniaforeignministry.com/pr_09/
20090831_protocol.pdf. See also The Turkish Weekly, August 31, 2009.
36
Armenia Suspends Normalization of Ties with Turkey, BBC News, April 22, 2010.
15
In recent months, Iran has boosted its diplomacy in the region, perhaps to counter growing
international concern about its nuclear program and to counter U.S. influence. Iran has proposed
to build a railroad link to Armenia and another to Azerbaijan. The latter railroad will permit not
only greater trade with Azerbaijan but also with Russia. Iran sells some gas to Armenia, and
Azerbaijan sells some gas to Iran. Irans efforts to improve relations with Azerbaijan have
appeared to be complicated, however, by its reported suppression of rising dissent among
Southern Azerbaijanis as well as alleged support for Islamic extremism in Azerbaijan. U.S.
policy aims to contain Irans threats to U.S. interests in the region.37
Azerbaijans relations with Iran were roiled in February 2012 when Iran accused Azerbaijan of
harboring Israeli intelligence agents who had crossed the Azerbaijani-Iran border to carry out
operations, allegedly including assassinations of Iranian nuclear scientists. That same month,
Azerbaijan sentenced seven individuals it had arrested in 2008 that it claimed had been trained in
Iran to carry out terrorism, including plans to bomb the Israeli embassy. In late February,
Azerbaijan confirmed that it had reached a large arms deal with Israel, but stated that the weapons
purchase was aimed not against Iran but to liberate occupied territories. In mid-March 2012, the
Azerbaijan National Security Ministry announced that nearly two dozen terrorists trained in Iran
had been arrested, who had been planning attacks on Israeli and U.S. embassies and other
Western interests, and at the end of the month, the ministry reported that two other Iranian spy
networks had been uncovered in 2011.
Also in late March 2012, Iran increased its accusations that Azerbaijan was providing Israel with
military access to launch attacks on Iran after such allegations appeared in Western media. In
early April, Iran arrested some individuals it claimed were Israeli agents being directed from an
unnamed nearby country, presumably Azerbaijan. On April 12, Azerbaijani media reported that
the government had arrested several Iranians and Azerbaijanis involved in weapons and drug
smuggling from Iran.
In early September 2012, Iran released two Azerbaijani poets it had convicted in August on spy
charges, and Azerbaijan paroled an Iranian reporter convicted on drug charges, just before a visit
by the Iranian vice president to Azerbaijan. In October 2012, President Ahmadinezhad met with
President Aliyev on the sidelines of the Economic Cooperation Organization summit in Baku, and
both leaders reportedly expressed satisfaction with the development of political, economic, and
cultural cooperation between their two countries, and called for further expanding economic ties.
Azerbaijani officials reportedly have pledged to Iran that Azerbaijan will not be used as a
launching pad for third-party aggression against Tehran, but also have vowed to support
international sanctions against Iran.
In early August 2013, Azerbaijani Speaker Oqtay Asadov attended the swearing-in ceremony for
newly elected Iranian President Hasan Ruhani. However, Iran denounced the sentencing by an
Azerbaijani court in October 2013 of Iranian citizen Bahram Fayziarrested in March 2012to
15 years in prison on charges of planning an attack on the Israeli embassy and other crimes. Iran
denied court allegations that Fayzi was an agent of Irans Army of the Guardians of the Islamic
Revolution (Sepah). In late 2013, mutual border closures were a new source of contention.
37
See CRS Report RL32048, Iran: U.S. Concerns and Policy Responses, by Kenneth Katzman.
16
Other Countries
Among non-bordering states, the United States and European countries are the most influential in
the South Caucasus in terms of aid, trade, exchanges, and other ties. U.S. and European goals in
the region are broadly compatible, involving integrating it into the West and preventing an antiWestern orientation, opening it to trade and transport, obtaining energy resources, and helping it
become peaceful, stable, and democratic. As part of its European Neighborhood Policy, the EU
signed Action Plans with the three regional states in November 2006 that it hoped would foster
both European and regional integration.
Some observers have suggested that the EU assumed a more prominent role than the United
States in the region after the August 2008 Russia-Georgia conflict.38 The EU took the
international lead in mediating the conflict and in deploying observers after the ceasefire (see
The August 2008 Russia-Georgia Conflict, below). The EU launched an Eastern Partnership
program in 2009 to deepen ties with the South Caucasus states. Under the program, the EU plans
deep and comprehensive free trade agreements with those countries willing and able to enter into
a deeper engagement, gradual integration in the EU economy, and ... easier travel to the EU
through gradual visa liberalization.39 In July 2013, the EU announced the successful conclusion
of talks with Armenia on a Deep and Comprehensive Free Trade Area, as part of the Association
Agreement between the EU and the Republic of Armenia. The free trade agreement was expected
to bring Armenias laws and regulations into harmony with EU standards, greatly enhance
Armenias exports to the EU, and boost Western investment in Armenia.40 Instead, Armenia
announced in September 2013 that it would join the Russia-led Customs Union. Georgia initialed
its association and trade agreement at the EU Eastern Partnership summit in late November 2013.
The South Caucasus region has developed some economic and political ties with other Black Sea
and Caspian Sea littoral states, besides those discussed above. Azerbaijan shares with Central
Asian states common linguistic and religious ties and concerns about some common neighbors
(Iran and Russia). The South Caucasian and Central Asian states are concerned about ongoing
terrorist threats and drug trafficking from Afghanistan. Central Asias increasing ties with the
South Caucasus make it more dependent on stability in the wider region.
17
U.S. and international efforts to foster peace and the continued independence of the South
Caucasus states face daunting challenges. The region has been the most unstable part of the
former Soviet Union in terms of the numbers, intensity, and length of its ethnic and civil conflicts.
The ruling nationalities in the three states are culturally rather insular and harbor various
grievances against each other. This is particularly the case between Armenia and Azerbaijan,
where discord led to the virtually complete displacement of ethnic Armenians from Azerbaijan
and vice versa by the early 1990s, so that younger Armenians and Azerbaijanis now have no
memories of a more diverse past. The main languages in the three states are dissimilar (also, those
who generally consider themselves GeorgiansKartvelians, Mingrelians, and Svansspeak
dissimilar languages). The borders of the countries do not coincide with eponymous ethnic
populations. Separatist NK relies on economic support from Armenia, and Abkhazia and South
Ossetia from Russia.
South Caucasus states and breakaway regions have alleged the existence of various terrorist
groups that pursue mixes of political, ethnic, and religious goals, with such allegations having
increased greatly after September 11, 2001, and the intensification of international anti-terrorism
efforts. Armenia and Azerbaijan accuse each other of sponsoring terrorism. Georgian militias
reportedly were active in Georgias efforts in 2004 to regain control over South Ossetia. In
reaction, Russian defense and security officers allegedly assisted several hundred irregulars from
Abkhazia, Transnistria, and Russia to enter the region. Such irregulars and Abkhazian and South
Ossetian militias reportedly carried out widespread attacks against ethnic Georgians during and
after the August 2008 Russia-Georgia conflict. South Caucasus governments sometimes have
accused opposition political parties of terrorism and banned and jailed their followers. However,
some of the so-called terrorist violence has been hard to attribute to specific groups or agents that
aim to destabilize the governments. Other sources of violence, such as personal or clan
grievances, economic-based crime, or mob actions, are also prominent.
Islamic terrorism has been an intermittent problem in the region. Besides home-grown terrorism,
foreign terrorist influences have included groups from Russias North Caucasus area, statesponsored actors from Iran, and al Qaeda and other groups based in Afghanistan and Pakistan. In
Georgia, some Chechen terrorists with reported links to al Qaeda were seeking harborage in the
northern Pankisi Gorge in the 1990s and early to mid-2000s, but the area was brought under
control with some U.S. security assistance. The State Departments latest Country Reports on
Terrorism reported that there were a few alleged terrorist incidents in Georgia in 2012, In
Azerbaijan, the State Departments latest Country Reports on Terrorism reports that several
terrorist groups had endeavored to move people, money, and material through the country during
2012, but that counterterrorism efforts had reduced the presence of terrorist facilitators and
hampered their activities. The potential of rising sectarian conflict involving the majority Shiites
and Sunni extremist groups based in northern Azerbaijan also is of concern.41
In Azerbaijan, the Jayshullah (Warriors of Islam) and Salafi Forest Brothers terrorist groups
reportedly recently have indicated that they intend to launch new attacks against the government
after several years of relative quiescence. Jayshullah has operated since the mid-1990s, supported
by Iran. The group allegedly attacked the Baku office of the European Bank for Reconstruction
and Development in late 1998, planned an attack the U.S. Embassy in 1999, and carried out other
attacks that resulted in some deaths. The Forest Brothers is based in northern Azerbaijan and is
connected to insurgents in Russias Dagestan Republic and has alleged links to al Qaeda. The
41
U.S. Department of State, Country Reports on Terrorism 2012, May 30, 2013.
18
Forest Brothers allegedly attacked the Abu Bakr mosque in Baku in August 2008, resulting in
three deaths. Counter-terrorism operations were conducted against alleged members of the Forest
Brothers in Sumgait in 2012. On February 13, 2014, explosions occurred at four locations in
Baku and other cities, leaving three civilians dead. Some observers have linked these blasts to
Jayshullah or the Forest Brothers, although the government has stated that the explosions were
accidental and not terrorist-related.42 According to Azerbaijani media reports, several hundred
Sunnis and Shiites have traveled from the country to Syria to respectively support the rebels or
the regime, and some observers raise concerns that they may return home and carry out terrorist
acts.
42
BBC Monitoring, February 14, 2014; CEDR, February 14, 2014, Doc. No. CEL-38947328; January 29, 2014, Doc.
No. CEL-54658084. For background information, see the section on Terrorist Activities, in CRS Report RL30679,
Armenia, Azerbaijan, and Georgia: Security Issues and Implications for U.S. Interests, by Jim Nichol.
43
Facilitating Dialogue: Interview with Ambassador Andrzej Kasprzyk, OSCE Magazine, January 2010.
44
The status of the U.S. envoy was downgraded in 1993. In early 2006, the State Department eliminated the post of
U.S. Special Negotiator for Eurasian Conflicts and divided its responsibilities among the Deputy Assistant Secretary of
State and the Office of Caucasus Affairs and Regional Conflicts. In 2009, a separate post of U.S. OSCE Minsk Group
Co-Chair was filled by Ambassador Robert Bradtke. In December 2012, Ian Kelly became the acting U.S. co-chair
(and was appointed co-chair in February 2013). In August 2013, Secretary Kerry appointed James Warlick the U.S. cochair.
19
20
Meeting in Sochi, Russia, on March 5, 2011, Presidents Medvedev, Sargisyan, and Aliyev issued
a statement vowing to tackle all disputable issues peacefully and to probe incidents along the
ceasefire line.50 On March 17, 2011, a prisoner exchange occurred, as agreed to by Presidents
Aliyev and Sargisyan at Sochi. Persistent sniper fire led the chairman-in-office of the OSCE to
reiterate past calls by the OSCE and others for the removal of snipers from the line of contact. On
March 17, 2011, Azerbaijani Defense Minister Safar Abiyev reportedly stated that the
worthlessness of the Minsk Group talks had forced Azerbaijan to build up its military
capabilities in order to take serious and necessary measures to liberate NK and surrounding
areas.51
In late March 2011, the Minsk Group co-chairs released the executive summary of a report of
their findings and recommendations following an October 2010 Field Assessment Mission to the
occupied areas surrounding NK. The last such assessment had been carried out in 2005. The new
report appeared to generally echo the findings of the 2005 report that most of the towns and
villages that existed before the conflict are abandoned and almost entirely in ruins, although
some land was being farmed. They reported that there are an estimated 14,000 persons living in
small settlements and in the towns of Lachin and Kelbajar, for the most part ethnic Armenians
who were relocated from elsewhere in Azerbaijan. The harsh living conditions in the areas, the
co-chairs emphasized, reinforced their view that only a peaceful, negotiated settlement can bring
the prospect of a better, more certain future to the people who used to live in the territories and
those who live there now.52
In May 2011, the presidents of the United States, France, and Russia issued a statement on the
sidelines of a Group of Eight (group of industrialized nations) meeting in Deauville, France, that
urged the Armenian and Azerbaijani presidents to finalize agreement on the Basic Principles at an
upcoming late June 2011 meeting in Kazan, Russia. At this meeting, Presidents Sargisyan and
Aliyev issued a joint statement that agreement had been reached on some issues and that further
talks would be held. A couple of weeks later, then-President Medvedev, reportedly disappointed
that there had been scant progress at the talks, sent letters to the two leaders requesting
suggestions on how to move the talks forward.
In October 2011, the Minsk Group co-chairs issued a statement after talks with Presidents Aliyev
and Sargisyan that the two presidents had agreed in principle on some border incident
investigation procedures that the presidents had called for developing at their meeting in Sochi in
March 2011. A call for finalizing these procedures was issued at the OSCE Ministerial Council
Meeting in Vilnius in early December 2011.
Before a planned meeting of the Armenian and Azerbaijani presidents in Sochi, Russia, on
January 23, 2012, President Aliyev stressed that no one wants war, least of all Azerbaijan, which
has made such great achievements. However, this does not mean that negotiations ... will be
(...continued)
and the Presidents of Azerbaijan and Armenia, December 1, 2010.
50
Meeting with Presidents of Armenia and Azerbaijan, President of Russia, March 5, 2011, at http://eng.kremlin.ru/
news/1859.
51
Interfax, March 17, 2011.
52
OSCE, Minsk Group, Executive Summary of the Report of the OSCE Minsk Group Co-Chairs Field Assessment
Mission to the Occupied Territories of Azerbaijan Surrounding Nagorno-Karabakh, March 24, 2011.
21
focused on the prevention of war.53 At the Sochi meeting, the two presidents issued a joint
statement requesting Russia to act to facilitate humanitarian ties between the two countries and
pledging to speed up efforts to agree to the basic principles, which raised expectations among
some observers. The co-chairs of the OSCE Minsk Group also presented the Armenian and
Azerbaijani presidents with a draft plan for setting up a group to investigate incidents along the
line of contact, and the presidents called for further work on the plan.
In late March 2012, Azerbaijani presidential administration official Ali Hasanov acknowledged
that Baku regards the talks mediated by the president of Russia as the most significant means to
settle the NK conflict, given Russias close ties to Armenia. Hasanov claimed that Russia has
overwhelming influence over Armenia, and appeared to argue that Azerbaijans major goal is to
persuade Russia to use its influence to settle the conflict.54
On June 19, 2012, the presidents of the United States, France, and Russia, meeting on the
sidelines of the Group of Twenty (G-20; grouping of major developed and developing countries)
summit in Mexico, issued a joint statement regretting that there had not been substantial progress
since their last such appeal in mid-2011.55 Appearing to reflect the rejection of the creation of an
incident investigation mechanism, Azerbaijani Foreign Minister Mammadyarov stated on July 9,
2012, that the problem is not in mechanisms, it is in the presence of the Armenian troops in the
occupied Azerbaijani lands. If troops are withdrawn, both the problems with the incidents and
mechanisms will be solved. This is Azerbaijans position and we will not change it.56
Tense relations between Armenia and Azerbaijan were heightened at the end of August 2012
when Hungary extradited Azerbaijani citizen Ramil Safarovwho was sentenced to life in prison
for killing an Armenian officer during NATO trainingand he was immediately pardoned and
rewarded by Azerbaijani President Aliyev. Hungary protested that it had extradited the prisoner
only after receiving assurances from Azerbaijan that he would serve out the balance of his
sentence. Armenia broke off diplomatic relations with Hungary. The White House stated that it
was communicating its disappointment to Azerbaijan and several Members of Congress were
critical of the pardon.
The OSCE Minsk Group met individually with the Armenian and Azerbaijani foreign ministers in
Paris on September 2-3, 2012, and raised deep concern that the pardon had harmed peace
efforts. Appearing to respond to the OSCE statement, President Aliyev argued in a speech on
September 11, 2012, that the Minsk Group had been unsuccessful during its two-decade efforts in
moving Armenia to settle the NK conflict, so that the solution might depend on Azerbaijans use
of military force. He asserted that since NK was occupied by Armenia, Azerbaijans main focus
was on isolating Armenia from all international and regional [economic] projects (see also
below, Economic Conditions, Blockades, and Stoppages).57
At the OSCE Ministerial Council Meeting in Dublin on December 6, 2012, the three Minsk
Group co-chairing countries issued a statement raising concerns about increased tensions between
53
22
the two states in recent months, and called on the presidents to prepare their populations for the
day when they will live again as neighbors, not enemies.58
In a presidential campaign speech in January 2013, President Sargisyan reportedly advised
against Armenian recognition of the independence of NK at the moment, stating that such
recognition would end the peace talks and in that case, we must be ready for military actions.59
The co-chairs met with Azerbaijani Foreign Minister Mammadyarov in London on June 6 and
Armenian Foreign Minister Nalbandyan in Paris on June 28, and the two foreign ministers held a
joint meeting in Vienna with the co-chairs on July 12, in order to develop ideas for moving the
peace process forward and to explore holding a possible meeting between the presidents of
Armenia and Azerbaijan late in the year. On June 18, 2013, the presidents of the United States,
France, and Russia, meeting on the sidelines of the Group of 8 summit in the United Kingdom,
issued a joint statement pledging continued support for a settlement, but decried continued efforts
by the conflict parties to seek one-sided advantage. They urged that the sides consider the basic
principles as an integrated whole, rather than picking and choosing among the elements.
On October 17, 2013, OSCE teams led by the Personal Representative of the OSCE Chairman-inOffice, Ambassador Andrzej Kasprzyk, experienced shooting as they took part in a monitoring
exercise along the line of contact, and were forced to abandon the monitoring exercise. The cochairs decried the exceptional and regrettable incident as undermining the 1994 ceasefire
agreement.
Presidents Aliyev and Sargisyan met in Vienna on November 19, 2013, their first meeting since
early 2012, and both agreed to continue negotiations toward a peace settlement, although no
details were provided. The co-chairs of the Minsk Group visited the region on December 15-19,
2013, and urged that the sides refrain from violence along the line of contact and maintain an
atmosphere conducive to talks.
In January-February 2014, tensions in Armenia-Azerbaijan relations appeared to increase, despite
a putative pledge to refrain from military actions during the Olympic Games in Sochi, Russia.
Azerbaijani media reported that there were over 1,500 ceasefire violations in the latter part of
January, almost as many as in all of 2013. The Minsk Group co-chairs met with the Armenian and
Azerbaijani foreign ministers on January 24, 2014, and expressed deep concern over escalating
violence that they viewed as undermining negotiations and prospects for peace, and called for
unconditional respect for the terms of the ceasefire agreement.60
58
OSCE, Press Release: Statement by the Heads of Delegation of the OSCE Minsk Group Co-Chair Countries,
December 6, 2012.
59
Licentious Behavior of Azerbaijani Authorities is First of All Harming Them: President of Armenia, Armenpress
News Agency, January 21, 2013, at http://armenpress.am/eng/news; CEDR, January 22, 2013, Doc. No.
CEP-950061.
60
BBC Monitoring, February 12, 2014; CEDR, February 3, 2014, Doc. No. CEL-46259717; Baku News, January 30,
2014; CEDR, January 31, 2014, Doc. No. CEL-43190428; January 29, 2014, Doc. No. CEL-59025792.
23
Vladimir Socor, Eurasia Insight, November 20, 2006. According to an issue of the Rossiyskoye Voyennoye
Obozreniye (Russian Military Review) published by the Defense Ministry in early 2008, 80% of residents of Abkhazia
were citizens of Russia at that time, and most had voted in the December 2007 Russian legislative election. CEDR,
April 21, 2008, Doc. No. CEP-358004.
24
Abkhazia that Russian officials reportedly stated would be fully armed in order to repulse
possible Georgian attacks on Abkhazia.62 In late May 2008, Russia announced that about 400
railway construction troops were being sent to Abkhazia for humanitarian work. These
troopswhose role is to facilitate military positioningreportedly left Abkhazia at the end of
July 2008 after repairing tracks and bridges. According to former Deputy Assistant Secretary
Bryza, the railway was used in August by Russia when its troops moved into Georgia.63
25
with the rest of Georgia, and were shelling areas across the border by the morning of August 10.
Russian warplanes bombed the outskirts of the capital, Tbilisi, as well as other sites. Russian
ships landed troops in Georgias breakaway Abkhazia region and took up positions off Georgias
Black Sea coast.
On August 12, then-President Medvedev declared that the aim of Russias operation for coercing
the Georgian side to peace had been achieved and it had been decided to conclude the
operation.... The aggressor has been punished and suffered very heavy losses.65 Medvedev
endorsed some elements of a European Union (EU) peace plan presented by visiting then-French
President Nicolas Sarkozy. On August 15, the Georgian government accepted the Frenchbrokered six-point cease-fire that left Russian forces in control of South Ossetia, Abkhazia, and
security zones in undisputed Georgian territory.66 The six points included commitments not to
use force, to halt hostilities, to provide full access for humanitarian aid, to withdraw Georgian
forces to the places they were usually stationed prior to the conflict, to withdraw Russian forces
to positions prior to the outbreak of hostilities (although they were permitted to implement
security measures in the zone of the conflict until international monitors were in place), and to
open international discussions on ensuring security and stability in Abkhazia and South Ossetia.
Much of the international community condemned then-President Medvedevs August 26, 2008,
decree officially recognizing the independence of South Ossetia and Abkhazia.67 Nicaragua,
Venezuela, and a few small Pacific island nations are the only countries that have followed suit in
extending diplomatic relations to Abkhazia and South Ossetia.
On September 8, 2008, then-President Medvedev and visiting then-President Sarkozy signed a
follow-on ceasefire accord that fleshed out the provisions of the six-point peace plan. Among its
provisions, it stipulated that Russian forces would withdraw from areas adjacent to the borders of
Abkhazia and South Ossetia by October 11; that Georgian forces would return to their barracks
by October 1; that international observers already in place from the U.N. and OSCE would
remain; and that the number of international observers would be increased by October 1, to
include at least 200 observers from the EU, and perhaps more later. The EU called for Russia to
permit these observers to patrol in Abkhazia and South Ossetia. Russias position has been that
these observers cannot patrol in the regions without the approval of the regions, and the regional
leaders have refused to permit such patrols. Although Sarkozy strongly implied that the
international conference would examine the legal status of Georgias breakaway Abkhazia and
65
ITAR-TASS, August 12, 2008. On September 11, Prime Minister Putin stated that Georgias aggression was answered
by a well-deserved mighty punch by Russia. ITAR-TASS, September 11, 2008.
66
See CRS Report RL34618, Russia-Georgia Conflict in August 2008: Context and Implications for U.S. Interests, by
Jim Nichol, August 29, 2008.
67
The EU fact-finding mission on the causes and outcome of the Russia-Georgia conflict stated that according to
overwhelmingly accepted principles of international law, only former constituent republics such as Georgia but not
territorial sub-units such as South Ossetia or Abkhazia are granted independence in case of dismemberment of a larger
entity such as the former Soviet Union. Hence, South Ossetia did not have a right to secede from Georgia, and the same
holds true for Abkhazia.... Recognition of breakaway entities such as Abkhazia and South Ossetia by a third country ...
runs against Principle I of the Helsinki Final Act which states the participating States will respect each others
sovereign equality and individuality ... including in particular the right of every State to juridical equality, to territorial
integrity and to freedom and political independence. The fact-finding mission also pointed out that the founding
documents of the Commonwealth of Independent States, to which Georgia belonged from 1993 to 2008, called for
upholding the territorial integrity of the members. Council of the European Union, Report of the Independent
International Fact-Finding Mission on the Conflict in Georgia, September 2009, Vol. 1, p. 17; Vol. 2, pp. 127-146.
26
South Ossetia, Medvedev asserted that the regions had been recognized as independent by Russia
on August 26, 2008, and that disputing this recognition was a fantasy.68
Many observers have argued that Russia aimed both to consolidate control over South Ossetia
and Abkhazia and to depose then-President Saakashvili when it launched the August 2008
military incursion into Georgia. Russia hoped to achieve this latter goal either directly by
occupying Georgias capital of Tbilisi and killing or arresting Saakashvili, or indirectly by
triggering his overthrow, according to these observers. They state that Saakashvilis survival as
the popularly elected president was a major accomplishment of the diplomacy of the EU and the
United States that ended Russias offensive.69
By October 1, 2008, the EU Monitoring Mission (EUMM) had deployed over 200 monitors and
Russia announced on October 9 that its troops had withdrawn from buffer zones. Georgia has
maintained that Russian troops have not pulled out of Akhalgori, a district that Russia asserts is
within South Ossetias Soviet-era borders, and the Kodori Gorge, and that no Russian military
bases are permitted in the regions. In December 2008, Russia objected to continuing a mandate
for about 200 OSCE observers in Georgiaincluding some observers authorized before the
August 2008 conflict and some who were added after the August 2008 conflictand they pulled
out on June 30, 2009. Similarly, in June 2009 Russia vetoed a UNSC resolution that extended the
UNOMIG mandate, and they pulled out of Abkhazia. The UMM is now the sole international
group of monitors. It reported in February 2014 that there were 279 staffers, of which around 200
were monitors, and that the monitors were based in three field offices near the contested
borders.70
According to U.S. officials, the EUMM has been effective at debunking several allegations made
by Russia and the separatist regions that ceasefire violations have been committed by Georgia.
They contrast Georgias cooperation with the EUMM to the refusal of Russia, Abkhazia, and
South Ossetia to permit patrols in the regions.71 In late April 2012, Abkhazia declared that the
head of the EUMM was persona non grata, including because he advocated for the EUMM to
patrol inside the breakaway regions. Abkhazia has refused to reconvene meetings of the incident
prevention group (see below) since then, because the EUMM head normally would attend. The
meetings have not resumed even though the EUMM head was rotated in September 2013.
An international conference to discuss security, repatriation, and status issues related to the
conflict held its inaugural session in Geneva on October 15, 2008. Facilitators at the talks include
the U.N., the EU, and the United States. Russia, South Ossetia, and Abkhazia reject any
challenges at the conference to the claimed independence of the breakaway regions. Russia has
insisted at these meetings and elsewhere that the international community impose an arms
embargo on Georgia. Russia also has insisted at these meetings that Georgia sign non-use-of68
27
force agreements with the breakaway regions. In March 2010, Russia stated that, as a preliminary
to the signing of such agreements, Georgia, South Ossetia, and Abkhazia could provide written
pledges of the non-use of force to the United Nations (see below).72
Among significant Geneva conference meetings:
In February 2009, the sides agreed to set up an incident prevention and response
mechanism along the South Ossetian border with the rest of Georgia in order to
defuse tensions before they escalate. On April 23, the first meeting of the
Georgia-South Ossetia Incident Prevention and Response Mechanism was
convened in the Georgian town of Ergneti, with the participation of the Georgian
and South Ossetian sides, as well as representatives of the Russian Ministry of
Defense, the OSCE, and the EU.
At the July 2009 Geneva conference meeting, the sides discussed setting up an
incident prevention group to resolve issues such as cross-border travel between
Abkhazia and the rest of Georgia. A meeting in Gali, Abkhazia, to establish the
group was held on July 14, 2009.
At the October 14, 2010, meeting, Russia announced that it was pulling its troops
out of the town of Perevi, Georgia, near the border with South Ossetia. The
troops pulled out on October 18, 2010. Russia declared that this pullout marked
its complete fulfillment of the ceasefire accords.73
At the June 7, 2011, meeting, Georgia raised concerns about alleged Russian
terrorist attacks and plans (see below) and stated that it might reconsider
participation in the Geneva conference if the terrorism persisted.
At the December 14, 2011, meeting, the moderators, the United States, and
Georgia argued that if binding nonuse-of-force agreements are signed, they
logically should include provisions for international monitors to patrol in the
breakaway regions, a stance rejected by Russia, South Ossetia, and Abkhazia.
Georgia and South Ossetia agreed to exchange over two dozen detainees who
allegedly had illegally crossed disputed borders. The prisoner exchangeunder
the aegis of the incident prevention mechanismtook place at the end of
December 2011.
At the June 7-8, 2012, meeting, the Russian side criticized then-Secretary
Clintons announcement during her just-concluded visit to Georgia that U.S.
embassies and consulates would recognize the validity of status-neutral travel
documents issued by Georgia to residents of Abkhazia and South Ossetia who
wished to travel or study in the United States.
The new Ivanishvili government hoped for progress at the December 11-12,
2012, Geneva meeting, but voiced disappointment after the meeting and
criticized Russia for failing to consider its proposals.
72
Samuel Charap and Cory Welt, A More Proactive U.S. Approach to the Georgia Conflicts, Center for American
Progress, February 2011; CEDR, July 28, 2010, Doc. No. CEP-6001.
73
The Georgian Foreign Ministry issued a statement that the withdrawal of Russian troops from Perevi was welcome
but was just a miniscule step in comparison with commitments envisaged by the ceasefire agreement of August 12,
2008, which Russia still has to comply with. Statement of the Ministry of Foreign Affairs of Georgia on the
Withdrawal of the Russian Armed Forces, Ministry of Foreign Affairs of Georgia, October 19, 2010.
28
At the March 26-27, 2013, meeting, Russias Deputy Foreign Minister, Grigoriy
Karasin, accused Georgia of hindering the talks and claimed that the only point
of the talks was to convince Georgia to sign a non-use of force agreement with
the breakaway regions. At the same time, Russia continued to refuse to pledge
not to use force against Georgia (see below).
The June 25-26, 2013, meeting was roiled by increasing efforts by Russias
border guards to erect fences and other obstacles between what Russia claimed
was the border of South Ossetia with the rest of Georgia (see also below).
Georgia termed the obstacles a violation of the ceasefire accords and also
rejected attempts by Russia and the breakaway regions to change the format of
the talks.
The latest inconclusive round of talks took place in December 2013, and the next
round is scheduled for March 25-26, 2014.
In late 2010, then-President Saakashvili gave speeches at sessions of the European Parliament and
the OSCE in Astana, Kazakhstan, pledging the non-use of force except in cases of self-defense.74
South Ossetia and Abkhazia followed suit with oral statements, but Russia refused to issue such a
pledge on the grounds that it was not a party to the conflict. In March 2013, the Georgian
legislature approved a resolution on foreign policy that reaffirmed the non-use of force pledge.
The International Crisis Group (ICG), a non-governmental organization, estimated in June 2010
that there may be fewer than 30,000 people residing in South Ossetia, and that the population
continues to decline (a 1989 census, taken before the beginning of conflict, reported a regional
population of 98,500). The ICG suggests that the region is increasingly less able to govern or
sustain itself economically, and so must rely on Russian aid and thousands of Russian
construction and government workers, troops, and border guards that are deployed there.75
In March 2011, then-Assistant Secretary of State Philip Gordon reiterated the U.S. position that
Georgias territory is occupied by Russian troops. He explained that
We believe that Russia used disproportionate force and remains present in what we consider
to be sovereign Georgia. So its not meant to be a particular provocation, its just a
description of what we think the situation is and weve very active in the Geneva talks and
bilaterally with Russia to try to bring about an end to what we consider to be a military
occupation.76
On June 2 and June 6, 2011, Georgia announced that it had apprehended Russian terrorist
infiltrators who were planning attacks in Georgia, including against the NATO Liaison Office in
Tbilisi. Georgia alleged that Russian security agencies were behind the planned attacks. Russia
termed these allegations artificially fabricated arrays of data.77 In late July 2011, the
Washington Times alleged that the U.S. intelligence community had backed up a Georgian claim
that Russian intelligence operatives had orchestrated a bombing in September 2010 near the U.S.
74
President of Georgias Address to European Parliament Members, Mikheil Saakashvili, The President of Georgia, at
http://www.president.gov.ge/index.php?lang_id=ENG&sec_id=228&info_id=5857; Le Figaro, November 23, 2010.
75
International Crisis Group. South Ossetia: The Burden of Recognition, June 7, 2010.
76
U.S. Embassy, Bratislava, Slovakia, Assistant Secretary of State for Europe Phil Gordon in Bratislava: The U.S.
Relationship With Central Europe Under the Obama Administration, March 3, 2011.
77
Ministry of Foreign Affairs of the Russian Federation, June 13, 2011.
29
Embassy in Tbilisi.78 In May 2012, the Georgian government apprehended a resident of Abkhazia
who it claimed had been directed by Russian intelligence to plant a bomb at government offices
in Zugdidi, a town in western Georgia.
In February 2013, Russias border guards launched new efforts to erect fences and other obstacles
between what Russia claimed was the border of South Ossetia with the rest of Georgia. In late
May 2013, Prime Minister Ivanishvili decried the border construction actions as most
unexpected, and incomprehensible, particularly in the light of efforts by his administration to
improve ties with Russia.79 The United States and NATO have criticized the ongoing construction
of the fences and other obstacles.
On January 21, 2014, Georgian Foreign Minister Panjikidze appeared to state that Georgia would
not re-establish diplomatic relations with Russia as long as the latter refused to recognize
Georgias territorial integrity, including Tbiliss sovereignty over breakaway Abkhazia and South
Ossetia.80
The Tagliavini Report on the Origins and Outcome of the August 2008 Conflict
On September 30, 2009, a special EU fact-finding mission led by Swiss diplomat Heidi Tagliavini
released a report on the origins and outcome of the August 2008 Russia-Georgia conflict. On the
one hand, the mission concluded that open hostilities began with a large-scale Georgian military
operation against the town of Tskhinvali [in South Ossetia] and the surrounding areas, launched
on the night of 7 to 8 August 2008. Operations started with a massive Georgian artillery attack.
The mission also argued that the artillery attack was not justifiable under international law.
However, it also argued that the artillery attack was only the culminating point of a long period
of increasing tensions, provocations and incidents by the parties to the conflict. On the other
hand, the mission suggested that much of the Russian military action went far beyond the
reasonable limits of defense, and that such action outside South Ossetia was essentially
conducted in violation of international law. In Abkhazia, actions by Russian-supported militias
in the upper Kodori Valley constituted an illegal use of force ... not justified under international
law. The mission likewise asserted that actions by South Ossetian militias against ethnic
Georgians inside and outside South Ossetia, must be considered as having violated International
humanitarian law and in many cases also human rights law.81 Commenting on the release of the
report, a U.S. State Department spokesman stated that we recognize that all sides made mistakes
and miscalculations.... But our focus is on the future.82
Washington Times, July 27, 2011; Maka Gurgenidze, CIA Reportedly Concluded Bombing of U.S Embassy in
Tbilisi has Ties to Moscow, CACI Analyst, August 3, 2011.
79
Georgia-Russia: Border Demarcation Issue Poses Threat to Emerging Thaw, Open Source Center Analysis, June 7,
2013.
80
Civil Georgia, January 22, 2014.
81
Report of the Independent International Fact-Finding Mission on the Conflict in Georgia, Vol. 3.
82
U.S. Department of State. Daily Press Briefing, September 30, 2009.
30
lingering effects of the 1988 earthquake in Armenia. Gross domestic product (GDP) began to
rebound in the states in the mid-1990s. Investment in oil and gas resources has fueled economic
growth in Azerbaijan at the expense of other sectors of the economy, although there are efforts to
strengthen non-oil sectors. Problems of poverty and regional conflict have contributed to high
emigration from all three states, and remittances from these migrs have provided major support
for the remaining populations.
The global economic downturn that began in 2008 hampered Armenias economic growth and
added to Georgias economic stresses in the wake of the August 2008 conflict. Azerbaijans
energy revenues, although reduced, helped it weather the downturn with continued GDP growth.
The influx of international assistance to Georgia ameliorated to some degree the impact of the
conflict and the world economic crisis. In 2009, Russia provided a $500 million loan to Armenia
to assist it in economic stabilization and recovery (in October 2013, Armenia repaid the loan,
which was poised to increase its servicing fees, with the proceeds of a Eurobond). Perhaps
surmounting the downturn, all the regional economies reported GDP growth in 2011 and
thereafter. Major economic accomplishments in recent years have included the reduction of a high
rate of poverty in Azerbaijan and the World Banks assessment that Georgia had continued to
make progress among 189 countries in making business regulatory reforms and ranked 8th
worldwide in 2013 in the overall ease of doing business.83
Transport and communications obstructions and stoppages have severely affected economic
development in the South Caucasus and stymied the regions emergence as an East-West and
North-South corridor. Since 1989, Azerbaijan has obstructed railways and pipelines traversing its
territory to Armenia.84 According to the U.S. Embassy in Baku, Azerbaijans Nakhichevan
exclave is blockaded by neighboring Armenia. From 2006 until 2013, Russia restricted
agricultural trade and land, air, and sea links with Georgia. Russia hinders Azerbaijans use of the
Volga-Don Canal to reach world shipping channels. Russia has at times cut off gas supplies to
Georgia. During the August 2008 Russia-Georgia conflict, Russias effective blockade of
Georgias Black Sea ports disrupted trade shipments to and from Armenia. In the wake of the
conflict, gas transit from Russia to South Ossetia via other Georgian territory was disrupted, with
each side blaming the other, until service was restored in late January 2009. In late August 2009,
Russia completed construction of a 110-mile gas pipeline from North Ossetia to South Ossetia to
avoid transiting Georgia. Trans-border road traffic between Georgia and the regions of South
Ossetia and Abkhazia is severely restricted.
Armenia has hoped for the reopening of a section of railway transiting Georgia to Abkhazia and
Russia, but while Georgian Prime Minister Ivanishvili in late 2012 called for reopening the
railway, Abkhazia rejected the offer unless it was accompanied by Georgias recognition of its
independence. Azerbaijani officials and others condemned the proposal, since the railway would
83
31
benefit Armenia, and stated that Baku might respond by restricting economic projects in
Georgia.85
In June 2013, Rovnag Abdullayev, the CEO of Azerbaijans State Oil Company of the Azerbaijani
Republic (Socar), stated that his company humanely was prepared to supply gas to Armenia
through a disused pipeline if the latter country requested assistance, since Russia was charging
more for gas than Azerbaijan was charging Georgia. The proposal was dismissed by Armenia,
particularly since the Azerbaijani presidential administration reportedly added conditions to the
offer.
Turkey closed its land borders with Armenia in 1993. These obstructions have had a negative
impact on the Armenian economy, since it is heavily dependent on energy and raw materials
imports. Turkeys closure of land borders in effect barred direct U.S. shipments of aid through its
territory to Armenia. Foreign Operations Appropriations for FY1996 (P.L. 104-107) and Omnibus
Consolidated Appropriations for FY1997 (P.L. 104-208)86 have mandated U.S. aid cutoffs (with a
presidential waiver) to any country which restricts the transport or delivery of U.S. humanitarian
aid to a third country. These provisions were designed to convince Turkey to allow the transit of
U.S. aid to Armenia. (See also above, The Roles of Turkey, Iran, and Others.)
Azerbaijani Civil Aviation official Arif Mammadov reportedly warned in late March 2011 that
Azerbaijan could shoot down airplanes that have not received Azerbaijani permission to land at
an airport being constructed in Stepanakert (Xankandi), the capital of NK. Then-U.S. Ambassador
Bryza reportedly condemned the idea of attacking civilian aircraft and the Azerbaijani Foreign
Ministry pledged that the country would not attack civilian aircraft.87 As the airport neared
completion, an Azerbaijani air force official in January 2013 reportedly reiterated that
unpermitted flights ... will be prevented. Reportedly, new Azerbaijani government regulations
call for forcing an intruding airplane to land, and if it does not comply and there is no information
on civilian passengers, for shooting it down.88 In October 2013, an NK official discussed plans to
build a road from Armenia into northern NK, since Azerbaijan was blocking the operation of the
airport.89 The airport had not opened as of February 2014.
In early November 2013, Azerbaijan and Iran closed some border crossings in response to a
shooting incident. Although Iran later that month reopened these border crossings, it restricted
heavy truck cargoes from Azerbaijan, claiming that bridge repairs were needed. Nakhichevan is
dependent of trucks entering Iran to carry goods to the exclave. Trucks with heavy cargoes have
been forced to downsize their loads or transit Georgia and Turkey to enter Nakhichevan.
85
CEDR, January 17, 2013, Doc. No. CEP-950152; November 10, 2012, Doc. No. CEP-950054; November 30, 2012,
Doc. No. CEP-964141; Eka Janashia, Abkhazia Seeks to Change Geneva Format, Central Asia-Caucasus Analyst,
November 28, 2012.
86
P.L. 104-208, 559, amends the Foreign Assistance Authorization Act of 1961.
87
CEDR, March 23, 2011, Doc. No. CEP-950100; April 11, 2011, Doc. No. CEP-950112; Azerbaijan Threatens To
Shoot Down Karabakh Planes, RFE/RL, March 16, 2011.
88
Joshua Kucera, Azerbaijan Again Threatens Karabakh Flights, Eurasianet, January 8, 2013; CEDR, January 21,
2013, Doc. No. CEP-950071.
89
CEDR, October 8, 2013, Doc. No. CEL-25050181.
32
90
91
In Armenia, the most significant human rights problems in 2013 were corruption and lack
of transparency in government, limitations on the right of citizens to change their
government, and the limited independence of the judiciary. Allegations of persistent
corruption undermined the rule of law. Courts remained subject to pressure from the
executive branch, which resulted in some politically motivated prosecutions and
sentencing. Other abuses included use of alleged torture and beatings by police to obtain
confessions and during arrest and interrogation. Authorities continued to arrest and detain
criminal suspects without reasonable suspicion. Some members of the security forces
continued to commit human rights abuses with impunity. Authorities did not adequately
enforce laws against government intrusion on the right to privacy and unlawful searches.
Media coverage lacked diversity of political opinion. Religious restrictions affected some
minority religious groups. Human trafficking was a problem, but authorities made efforts
to combat it.
In Azerbaijan, the most significant human rights problems during 2013 included
increased restrictions on freedoms of expression, assembly, and association, including
intimidation, arrest, and use of force against journalists and human rights and democracy
activists. Amendments adopted during the year further restricted NGO financing. The
State Department raised concerns about increased reports of arbitrary arrest and
detention, politically motivated imprisonment, executive influence over the judiciary, and
lengthy pretrial detentions for those perceived as a threat by government officials.
Authorities failed to provide due legal process with regard to property rights. Following
the October 2013 presidential election, authorities launched a criminal investigation
against two election-monitoring NGOs and arrested the head of one of the NGOs. Other
human rights problems reported in 2013 included continued arbitrary invasions of
privacy, restrictions on the religious freedom of some unregistered groups, constraints on
33
In Georgia, the most important human rights problems reported during the year included
the dismissal of government employees from local government institutions allegedly for
their association with the former ruling party (the United National Movement or UNM),
increased societal violence against members of the lesbian, gay, bisexual, and transgender
community and the governments failure to hold perpetrators responsible, and local
government interference with the rights of religious minorities. Other problems reported
during 2013 included police abuse of detainees and allegations of politically motivated
harassment. Following the October 2012 legislative election, UNM members reported
arbitrary harassment, job loss, and arrests due to their political affiliation or activities.
External and internal influence on the judiciary remained a problem, although there were
some positive steps. Although the media environment improved, there were reports of
government pressure on the media, especially Georgias Public Broadcaster. Trafficking
in persons remained a problem. The government took steps to promote accountability. As
of December 2013, the government had charged 50 former senior Saakashvili
administration officials with crimes including obstruction of justice, misappropriation of
government funds and money laundering, blackmail, privacy intrusion, and abuse of
power.92
92
U.S. Department of State, Country Reports on Human Rights Practices for 2013, February 27, 2014.
Council of Europe, European Commission For Democracy Through Law, European Commission For Democracy
Through Law (Venice Commission) and OSCE ODIHR Draft Joint Opinion on the Electoral Code of Armenia Adopted
on 26 May 2011, Opinion No. 611 / 2011, September 29, 2011.
93
34
Eight parties and the Armenian National Congress (an opposition party bloc) were approved to
run on party lists for 90 seats in the May 6, 2012, legislative election. In addition, 155 candidates
were registered to run for 41 seats in single-mandate constituencies. Of these candidates, 66 were
self-nominated. Official campaigning began on April 8. Nearly 63% of 2.5 million registered
voters turned out. Six of the eight parties won legislative seats in the party list portion of the
election. The Republican Party won 40 seats, the Prosperous Armenia Party won 28 seats, the
Armenian National Congress bloc won 7 seats, the Heritage Party won 5 seats, the Armenian
Revolutionary Federation won 5 seats, and the Orinets Yerkir Party won 5 seats. In the
majoritarian races, the Republican Party won about three-quarters of the seats, giving it a bare
majority of seats in the legislature. A majority of incumbent deputies were returned to the
legislature.
According to the final report issued by the OSCE monitoring mission, the election was
competitive, vibrant, and largely peaceful, but was marred by an unequal playing field and by
deficiencies in the complaint and appeals process. Media coverage appeared free and fair, as were
candidate registration processes. Participants raised concerns about the accuracy of voter lists.
Violations of electoral codes were sometimes committed by local authorities, including school
teachers, who participated in campaign activities, and by party-linked organizations, which
provided gifts to voters. Election monitors observed the presence of unauthorized persons or
group voting in 12% of nearly 1,000 polling stations visited. Vote counting was assessed
negatively in almost one-fifth of polling stations, including the participation of unauthorized
persons in counting. Vote tabulation was assessed negatively in most higher-level electoral
commissions visited.94 U.S. Ambassador to Armenia John Heffern reportedly assessed the
election as a major step forward in democratization in Armenia, pointing to a lot of progress in
several key areas, including access to media and orderly and transparent voting (including the
presence of cameras in polling places). At the same time, he stated that the OSCE monitors had
reported that there were some problems, so that there is still some work to do for the elections
next time.95
On May 30, 2012, the Republican Party and the Orinats Yerker (Rule of Law) Party (headed by
National Security Council Secretary Artur Bagdasaryan) formed a coalition. A former coalition
member, the Prosperous Armenia Party, declined to join the new coalition. At the opening session
of the new legislature on May 31, Hovik Abrahamyan was elected Speaker (he had stepped down
as speaker in late 2011 to head up the election campaign of the Republican Party). On June 2,
2012, President Sargisyan re-appointed Tigran Sargisyan as prime minister.
On January 14, 2013, Armenias Central Electoral Commission registered eight candidates for the
February 18, 2013, presidential election. Some observers questioned why major political parties
and politicians failed to field candidates or run, including former President Robert Kocharyan,
Prosperous Armenia Party head Gagik Tsarukyan, and Armenian National Congress (ANC) head
Levon Ter-Petrosyan (the Freedom Party, a member of the ANC bloc, fielded candidate Hrant
Baghratyan, but he was not endorsed by the ANC). Ter-Petrosyan claimed that he was too old
(68) to rule effectively and that fraudulent election practices of the past remained in place. Some
observers alleged that the Prosperous Armenia Party had been persuaded to not field a candidate.
94
OSCE, ODIHR, International Election Observation, Republic of Armenia, Parliamentary Elections, 6 May 2012:
Statement of Preliminary Findings and Conclusions, May 7, 2012; Republic of Armenia, Parliamentary Elections, 6
May 2012, OSCE/ODIHR Election Observation Mission: Final Report, June 26, 2012.
95
Sargis Harutyunyan, U.S. Envoy Praises Armenian Elections, RFE/RL Armenian Service, May 18, 2012.
35
Campaigning began in a dramatic fashion on January 21, 2013, when candidate Andreas
Ghukasyan, a radio commentator, began a hunger strike to protest the fake election. The next
day, contender Arman Melikyan, a former official in the breakaway Nagorno Karabakh, also
questioned the fairness of the election and stated that he was suspending his campaigning.
Likewise, contender Aram Arutyunyan, head of the National Accord Party, stated that he planned
to withdraw a few days before the election (he pulled out on February 8). On January 31, 2013,
presidential candidate Paruyr Hayrikyan, head of the National Self-Determination Union Party,
was shot and injured, but did not withdraw from the contest. The OSCE long-term observers
characterized campaigning as low-key, with Sargisyan stressing the need for continued stability
and stressing his credentials as a military leader in NK and former defense minister.96 On
February 25, 2013, the CEC reported its final tally and declared that Sargisyan had won the
election with 58.64% of 1.5 million votes cast, followed by Hovannisyan with 36.74%.
Immediately after the election, Hovannisyan claimed that he had in fact won, but virtually all
election complaints made by his party were rejected by the CEC. His Heritage Party held a series
of protests throughout Armenia to call for new elections. As a footnote to the election campaign,
the National Security Service formally indicted one of the presidential candidates, poet Vardan
Sedrakiyan, on March 6 on charges of having ordered the attack on fellow candidate Hayrikyan.
According to the final assessment of the OSCE observers, the election was generally welladministered and was characterized by a respect for fundamental freedoms. However, the
observers also argued that there was lack of impartiality of the public administration, misuse of
administrative resources, and cases of pressure on voters.... [Election day] was marked by undue
interference in the process, mainly by proxies representing the incumbent, and some serious
violations were observed. The observers assessed the voting process negatively in 5% of 853
polling stations, including because of overcrowding and interference in the vote. Vote counting
and tabulation were assessed negatively in less than 10% of 106 polling stations and of 41
territorial election commissions observed. The OSCE observers later raised concerns about the
high correlation between turnout at polling stations and the vote for Sargisyan, the treatment and
dismissal of complaints, and restrictive media coverage of electoral problems. After the election,
government-owned or influenced television stations presented the OSCEs preliminary
assessment of the election mainly in a positive light, omitting critical elements, raising questions
over the genuineness of their efforts to provide an objective and independent portrayal of the
election.97
In his April 9, 2013, inaugural address, President Sargisyan pledged to continue to strengthen
democracy and enhance the rule of law, and to address the problems of emigration, poverty, and
unemployment. Hovannisyan held an alternative inauguration protest that later resulted in some
detentions by police. Sargisyans cabinet resigned that same day as mandated by the constitution.
He has re-appointed his former prime minister and defense and foreign ministers.
A law went into effect in January 2014 that mandates automatic transfers of 6%-10% of salaries
of those born after 1973 to a state pension fund. The controversial law was suspended by the
Constitutional Court, upon an appeal by the four opposition parties in the legislature, but the
96
Organization for Security and Cooperation in Europe (OSCE), Office for Democratic Institutions and Human Rights
(ODIHR), Election Observation Mission, Republic of Armenia, Presidential Election, 18 February 2013: Interim
Report, No. 1, January 23, 2013; Interim Report, No. 2, February 7, 2013.
97
OSCE, ODIHR, Republic of Armenia, Presidential Election, 18 February 2013, OSCE/ODIHR Election Observation
Mission: Final Report, May 8, 2013; Republic of Armenia, Presidential Election, 18 February 2013: Post-Election
Interim Report (1926 February 2013), March 2, 2013.
36
government has called for continued implementation. The I Am Against civic movement and
others have launched protest actions throughout Armenia against the pension law. Some
protestors have called for President Sargisyan to resign.
Although the Sargisyan government hailed the January 2014 agreement with Russia on reducing
gas prices, gas prices for consumers were high during a harsh winter, reportedly contributing to
some hardship and discontent.
98
Shahla Sultanova, Azerbaijan: Can Facebook become a Substitute for Live Opposition Protests? Eurasianet,
November 19, 2012.
99
CEDR, April 22, 2013, Doc. No. CEL-42484764.
100
Embassy of the United States of America, Baku, Azerbaijan, Press Release: Ambassador Morningstar Speaks to
Free Thought University [Students], April 12, 2013; American Center Press Conference, Deputy Assistant Secretary of
State Thomas Melia, April 18, 2013.
37
Ten candidates were registered for the October 9, 2013, Azerbaijani presidential election,
including incumbent President Aliyev, who ran for his third term in office.101 The main opposition
candidate was Jamil Hasanli, an historian and former legislator, who was nominated by the
National Council of Democratic Forces, a coalition that includes the Musavat and Popular Front
parties. These parties had boycotted the previous 2008 presidential election on the grounds that it
would not be free and fair, but decided to ally to contest the 2013 election. Other opposition
candidates included legislator Iqbal Agazada, head of the Hope Party (who also ran in 2008),
legislator Ilyas Ismayilov, head of the Justice Party, and Sardar Calaloglu, head of the Democratic
Party. The Central Electoral Commission reported that 71.6% of 5.2 million voters turned out and
that President Aliyev received 84.54% of the vote, followed by 5.53% for Hasanli and 2.4% for
Agazada.102
According to the final report of the OSCE, the election was well organized, several candidates
took part, and turnout was high, but the electoral process was undermined by limitations on the
freedoms of expression, assembly, and association that provided advantages to the campaign of
the sitting president. Campaigning was marred by allegations of candidate and voter intimidation,
insufficient access by most candidates to the media, and harassment of journalists. The
government limited the number of venues where candidates could meet with voters and places
where campaign posters could be displayed. OSCE observers witnessed some efforts to coerce
individuals to attend presidential campaign rallies and to disrupt National Council rallies, and the
prosecutor announced that he was investigating National Council member activities. Hasanli was
warned that he had insulted the dignity of the president, a criminal offense. Editorial statements
by media and public affairs discussion of the campaign were constrained by law. Given the
restrictions on campaigning, substantive debate of platforms did not take place. Aliyevs
campaign emphasized the achievements of his presidency, while the campaigns of other
candidates to some extent addressed socioeconomic issues and corruption, and opposition
candidates called for upholding political rights and abolishing presidential domination of the
political system. Voting day also witnessed serious shortcomings, including instances of multiple
voting and ballot box-stuffing. The ballot-counting process was judged to be problematic in an
unprecedented majority of polling places, and included involvement of unauthorized
individuals in vote-counting and the reassigning of votes from one candidate to another. After the
election, the government harassed and detained some opposition party members and election
monitors.103
The State Department issued a statement regretting that despite urging by the United States, the
presidential election fell short of international standards. The State Department concurred with
OSCE and other monitors that there were serious vote-counting problems and a repressive
campaign environment. At the same time, the State Department praised the registration of some
101
For the previous election, see CRS Report RS22977, Azerbaijan's October 2008 Presidential Election: Outcome
and Implications, by Jim Nichol.
102
Central Electoral Commission of the Republic of Azerbaijan, Presidential Election of the Republic of Azerbaijan:
Protocol of the Voting Results, October 17, 2013, at http://www.msk.gov.az/uploads/protokollar/
CEC_protocol_2013.pdf. For background, see Shahin Abbasov, Azerbaijan: Presidential Campaign in Name Only?
Eurasianet, September 18, 2013; Shahin Abbasov, Azerbaijan: Putting Inauguration Ahead of the Vote, Eurasianet,
October 8, 2013.
103
OSCE, Office for Democratic Institutions and Human Rights, Republic of Azerbaijan, Presidential Election, 9
October 2013: OSCE/ODIHR Election Observation Mission, Final Report, December 24, 2013.
38
opposition candidates, the authorization of some opposition campaign rallies, and the decision to
invite the OSCE to monitor the election.104
Presidential administration head Ramiz Mehtiyev criticized the OSCE and State Department
assessments as flawed and rejected accusations that there was substantive falsification of the
results. He also alleged that the United States had tried to interfere in the electoral process. At the
end of October 2013, the prosecutor general launched an investigation into the finances of the
Center for Election Monitoring and Democracy Training, a prominent Azerbaijani NGO that had
criticized the presidential election process. Also in October 2013, a court case and government
action resulted in the suspension of publication of the opposition Azadliq newspaper. In late 2013,
media reported several arrests, trials, and convictions of opposition political activists, unfavored
religious figures, and others on charges that included drug trafficking, hooliganism, and plotting
disorder, among other charges.105
In February 2014, the High Representative of the European Union for Foreign Affairs and
Security Policy, Catherine Ashton, and the European Commissioner for Enlargement and
Neighbourhood Policy, Stefan Fule, issued a statement critical of just-enacted amendments to
Azerbaijans law on NGOs. They warned that changes restricting the registration of foreignheadquartered NGOs and their activities threatened to further limit human rights and democracy
advocacy by civil society groups in Azerbaijan. Over 100 NGOs signed a letter to PACE calling
for the organization to request that Azerbaijan respect human rights and repeal the 2014 changes
to the NGO law as well as other restrictions enacted in 2012-2013. The Azerbaijani Foreign
Ministry rejected the criticism, stating that the changes had been enacted after discussion with
NGOs.106
U.S. Department of State, Statement by Marie Harf, Deputy Spokesperson: Azerbaijan Presidential Election,
October 10, 2013.
105
Crackdown Under Way In Wake Of Azerbaijani Presidential Election, RFE/RL, November 14, 2013; Eldar
Mamedov, Azerbaijan: When It Comes to Dissent, the U.S. and EU Shouldnt Play Favorites, Eurasianet, December
11, 2013.
106
European Commission, Press Release: Statement by the spokespersons of EU High Representative Catherine
Ashton, and the European Commissioner for Enlargement and Neighbourhood Policy, tefan Fle, on Recent Events in
Azerbaijan, February 9, 2014; Turan, February 6, 2014; Turan, January 27, 2014.
39
continued peaceful transition of power. Several Members of Congress observed the election, and
several Members of the Senate issued a post-election statement commending then-President
Saakashvili for his efforts to transform Georgia into a prosperous democracy, while cautioning
that the future of U.S.-Georgia relations depended on the countrys continued commitment to
democratization.107
On October 25, 2012, the new legislature convened and the parties making up the majority GD
coalition approved Ivanishvili as prime minister, along with his proposed cabinet ministers.
Relations between the parties making up the GD coalition and the UNM in the legislature and
between the GD-led cabinet and the president were contentious in the run-up to the October 2013
presidential election. Saakashvili was term-limited and hence ineligible to run. Under
constitutional provisions already in place, the legislature was slated to gain greater powers vis-vis the presidency.
Beginning in early November 2012, the Ivanishvili government arrested officials who had served
in the previous Saakashvili government or who were active in the UNM, most prominently
former defense and interior minister Bacho Akhalaia and chief of the armed forces Georgy
Kalandadze, who were charged with allegedly beating six servicemen in 2011 and other crimes.
In two trials, Akhalaia was acquitted, and outgoing President Saakashvili pardoned him after a
conviction in a third trial. He remains in custody, however, awaiting a fourth trial. Kalandadze
was acquitted in August 2013. Among other prosecutions, in May 2013, former Prime Minister
Vano Merabishvili was detained on corruption charges, and in October 2013, French authorities
acting on an Interpol warrant detained former Defense Minister Davit Kezerashvili on charges in
Georgia of bribery and money laundering (in February 2014, he was released from French
custody pending a court decision on extradition). In December 2013, a Tbisili court suspended
UNM member Gigi Ugulava as mayor of Tbilisi, after he was charged with misspending funds.
In January 2013, the Georgian legislature overrode a presidential veto of a law on amnesty for
political prisoners, and nearly 200 alleged victims subsequently were released from prison,
including 13 individuals sentenced as Russian espionage agents. In addition, courts have
exonerated other prominent individuals sentenced by the former Saakashvili government.
Elected local councils and executive leaderships, formerly dominated by members of the UNM,
faced increasingly strident GD supporters, and many or most members and leaders resigned,
switched parties, or declared that they were independent of party affiliation. Some observers
decried this situation, terming it an effort by GD to take over local politics rather than cooperate
with the UNM.108
A presidential election was held on October 27, 2013. Prime Minister Ivanishvili stated that he
planned to step down as premier soon after the election.109 Twenty-three candidates were
registered to run. The GD candidate was Giorgi Margvelashvili, the former Minister of Education,
and the UNM candidate was legislator Davit Bakradze, the former legislative speaker and foreign
minister. Other prominent candidates included Nino Burjanadze, the head of the pro-Russian
107
U.S. Senate, Senator John McCain, Statement by Senators McCain, Lieberman, and Graham on Elections in
Georgia, October 3, 2012.
108
Molly Corso, Georgia: Political Tumult Hits Regions, Eurasianet, December 26, 2012; Lincoln Mitchell,
Georgia: Four Observations and Four Questions from the Georgian Election, Eurasianet, November 15, 2012.
109
For details, see CRS Report R43299, Georgias October 2013 Presidential Election: Outcome and Implications, by
Jim Nichol.
40
Democratic Movement-United Georgia Party and the former legislative speaker; Giorgi
Targamadze, head of the pro-Western and socially conservative Christian Democratic Movement;
and Shalva Natelashvili, head of the populist Labor Party. Georgias Central Electoral
Commission (CEC) reported that 46.6% of about 3.54 million registered voters turned out on
election day, and that Margvelashvili received enough votes (over 50%) to avoid a legally
mandated second round of voting for the top two candidates. Margvelashvili won handily,
receiving over 62% of the vote, with Bakradze coming in second with about 22% of the vote.
Some observers suggested that the relatively low turnout, compared to past elections, could be
attributable to the lesser constitutional powers to be wielded by the new president, public
sentiment against fundamental political change, and the lack of charismatic UNM and GD
candidates.
A final report by observers from the OSCE, the Parliamentary Assembly of the Council of Europe
(PACE), the European Parliament (EP), and the NATO Parliamentary Assembly judged that the
election was efficiently administered, with voting, counting, and tabulation viewed generally
positively. The rights of expression, movement, and assembly were respected by the government
and participants during the campaign, so that voters were able to express their choice freely on
election day. The monitors reported a few isolated instances of harassment of party activists by
rival supporters and other violence during the campaign period. They evaluated voting and vote
counting and tabulation as free and fair in the overwhelming majority of polling stations and
district electoral commissions observed.110
On November 2, 2013, Ivanishvili proposed that Interior Minister Irakli Garibashvili be
confirmed by the legislature as the new prime minister. He was confirmed by the legislature on
November 20, 2013, and the previous cabinet members were reappointed (with a new Interior
Minister). Ivanishvili retired from public office. Garibashvili told the legislators that Georgias
post-Soviet era had ended, and that the country now was constructing a European-style
democracy. He stressed that his government would give priority to the countrys integration with
the EU and NATO, while seeking better ties with Russia. A few days later, Garibashvili also was
named as the new head of GD. It has appeared that while the constitution mandates the sharing of
some powers and reserves other powers to the president, the ambiguities of the new constitutional
system have permitted the prime minister to assert more and more primacy in policymaking.
Raising concerns among some observers about the presumption of innocence, on January 16,
2014, Prime Minister Garibashvili reportedly asserted that detained former Prime Minister Vano
Merabashvili used budget funds to finance his party [and] will be sitting in jail for a long time.
However, following further allegations that Merabishvili may have ordered killings or used
excessive force against demonstrators, President Giorgi Margvelashvili stated on January 30,
2014, that we live in the state which is based on rule of law, where presumption of innocence of
every person is protected and only prosecutors office and the judiciary have to consider this
issue, not politicians.111 On February 17, 2014, Merabishvili was found guilty of theft of private
property and using public funds to support the UNM in the 2012 legislative election, and was
sentenced to five years in prison. He reportedly remains under investigation on these further
allegations.
110
Organization for Security and Cooperation in Europe, Office for Democratic Institutions and Human Rights,
Georgia, Presidential Election, 27 October 2013: OSCE/ODIHR Election Observation Mission, Final Report, January
14, 2014.
111
Interfax, January 16, 2014; CEDR, January 16, 2014, Doc. No. CEL-66948097; Civil Georgia, February 3, 2014.
41
In late January 2014, Ivanishvili announced the creation of a new NGO, Citizen, which he
stated would work to strengthen citizen input into governance.
The Administration also planned to continue assistance for participation by the regional states in
NATO activities and deployments (see Table 2).
Congress also has directed that humanitarian aid be provided to displaced persons and needy
civilians in NK out of concern that otherwise the region might not get aid. Such budgeted aid has
amounted to about $41 million from FY1998 through FY2012. See Table 5. In the Omnibus
Appropriations Act for FY2009 (P.L. 111-8) and the Consolidated Appropriations Act for FY2010
(P.L. 111-117) up to $8 million was made available for NK.113 Actual aid to NK has been about $2
112
CRS Report R42621, State, Foreign Operations, and Related Programs: FY2013 Budget and Appropriations, by
Susan B. Epstein, Marian L. Lawson, and Alex Tiersky. The CRS Report refers to U.S. Department of State, Executive
Budget Summary, Function 150 and Other International Programs, FY2012, p. 86.
113
Several Azerbaijani legislators protested the conference agreement to H.R. 3288 (P.L. 111-117) to direct up to $8
million in humanitarian aid to NK. Some legislators and the Azerbaijani presidential administration reportedly
suggested that such aid be shared with those who had fled the region. An Azerbaijani Foreign Ministry note to the State
Department said that the aid decreases confidence and trust toward the United States in Azerbaijan. CEDR,
December 16, 2009, Doc. No. CEP-950112; December 20, 2009, Doc. No. CEP-95002; January 4, 2010, Doc. No.
CEP-950063; OSC Report, January 12, 2010.
42
million per year since FY2002. Aid has been provided to NGOs to rehabilitate homes, renovate
health clinics and train personnel, repair water systems, provide micro-loans for agriculture, and
clear landmines. In FY2012, aid to NK was provided for demining ($1 million to the HALO Trust
NGO) and for rehabilitating the water system in Stepanakert/Khankendi ($1 million to the
CESCO NGO) (both of these are multi-year projects). Besides bilateral aid, the United States
contributes to multilateral organizations such as the International Monetary Fund and the World
Bank that aid the South Caucasus region.
43
continue (later this canceled amount was said to be about $59 million).115 Some of the roadbuilding projects canceled by MCC subsequently were funded by the World Bank. The MCC
reported in October 2011 that it had completed its compact with Armenia by disbursing $177
million. Beneficiaries reportedly included about 428,000 rural residents in hundreds of
communities across Armenia.
Since then, the MCC has not selected Armenia as eligible for a new compact. MCC scorecards
issued each year have highlighted concerns about fiscal policy, government expenditures for
health and education, political rights, and freedom of information. Most recently, an MCC
scorecard for FY2014 reiterated these concerns. One country, Lesotho, was selected for FY2014
as eligible for a compact. It was considered to have much higher scores on political rights and
freedom of information than Armenia.116
EUCOM initiatives in the region have included the Georgia Deployment Program and the
Caspian Regional Maritime Security Cooperation program. The Georgia Deployment ProgramISAF, a multi-year program that began in late 2009, is supported by Marine Forces Europe to
train and deploy Georgian forces alongside U.S. Marine Forces to Afghanistan. The program
encompasses rotations of Georgian battalions with a Marine Corps Marine Expeditionary Brigade
to southern Afghanistan.
115
U.S. Embassy in Yerevan, Background Information on the Status of the MCA-Armenia Program, December 16,
2008; MCC, Press Release: MCC Board of Directors Meets to Address U.S. Government Global Development
Priorities, June 10, 2009.
116
Millennium Challenge Corporation, Scorecard: Armenia FY14, at http://www.mcc.gov/documents/scorecards/scorefy14-english-am-armenia.pdf; Scorecard: Lesotho FY14, at http://www.mcc.gov/documents/scorecards/score-fy14english-ls-lesotho.pdf; Report on the Selection of Eligible Countries for FY2014, December 2013.
117
U.S. Senate. Committee on Armed Services. Hearing to Receive Testimony on U.S. European Command, U.S.
Northern Command, and U.S. Southern Command in Review of the Defense Authorization Request for Fiscal Year
2014 and the Future Years Defense Program, Testimony of Admiral James G. Stavridis, United States Navy,
Commander, United States European Command, March 19, 2013.
44
General Bantz John Craddock, former EUCOM Commander, testified in 2008 that the Caspian
Regional Maritime Security Cooperation program aimed to coordinate and complement U.S.
government security cooperation activities in Azerbaijan and Kazakhstan. U.S. Naval Forces
Europe continues to promote Maritime Safety and Security and Maritime Domain Awareness in
the Caspian Sea through routine engagement with Azerbaijan. These efforts aim to bolster
Azerbaijans capabilities to observe, evaluate, and respond to events in their maritime
domain.118 (This program appeared to combine elements of the former Caspian Guard and
Hydrocarbons programs.) Admiral Stavridis did not discuss this program in testimony in 2013,
but did mention U.S. Naval Forces Europes cooperation with Azerbaijan and with U.S. Central
Command on activities involving Kazakhstan and Turkmenistan. For FY2014, the Administration
requested FMF assistance for Azerbaijan to bolster their naval capabilities or otherwise enhance
Caspian Sea maritime security.
Of the cumulative assistance from all agencies and programs provided to the South Caucasian
states from FY1992 through FY2010, the State Department reports that $223 million was
provided to Armenia, $327 million to Azerbaijan, and $896 million to Georgia for ensuring
peace and security. This category includes law enforcement, border security, counter-narcotics,
counter-terrorism, and conflict mitigation funds. Also included are International Military
Education and Training (IMET), Foreign Military Financing (FMF), Section 1206 (to train and
equip forces for counterterrorism and operations in Afghanistan) and other Defense Department,
and agency and program funding (although some classified funding may not be reported).
Until waived, Section 907 had prohibited much U.S. security aid to Azerbaijan, including Foreign
Military Financing (FMF), and International Military Education & Training (IMET). Under U.S.
policy, similar aid had not been provided to Azerbaijans fellow combatant Armenia. From 1993
to 2002, both had been on the Munitions List of countries ineligible for U.S. arms transfers. Since
the waiver provision to Section 907 was enacted, some Members have maintained that the
Armenian-Azerbaijani military balance is preserved by providing equal amounts (parity) in IMET
and FMF assistance to each country. Successive Administrations have not always agreed with this
understanding of parity, and occasionally have requested unequal amounts of such aid, but
Congress usually has directed that equal amounts be provided. The account tables listing countrylevel assistance, released on March 21, 2014, as part of the State Departments Congressional
Budget Justification: Department of State, Foreign Operations, and Related Programs, FY2015,
calls for $1.7 million in FMF and $600,000 in IMET for each country.
The latest joint Defense and State Department report to Congress on foreign military training
stated that 269 Armenian students completed training in FY2012 at a cost of $1.88 million. The
largest share of the training was for 115 troops belonging to the Peace Keeping Brigadesome of
whom were deployed as part of the Kosovo Force (KFOR)and trained by USEUCOM at the
Grafenwoehr Training Area in Germany. In the case of Azerbaijan, 415 students completed
training in FY2012 at a cost of $1.92 million. The largest share of the training was funded by
FMF and Foreign Military Sales (FMS) (258 students) and Section 1206 (61 students). The FMF
and FMS training was not described in volume 1 of the report, but Section 1206 training mainly
involved training by Navy seals on diving and mine response.119
118
U.S. Senate. Committee on Armed Services. Statement of General Bantz J. Craddock, March 13, 2008.
U.S. Department of State and U.S. Department of Defense, Foreign Military Training, FY2012-FY2013, Joint
Report to Congress, Volume 1.
119
45
He stressed, however, that the United States has not rearmed Georgia as some have claimed.
There has been no lethal military assistance to Georgia since the August [2008] conflict. No part
of the $1 billion U.S. assistance package went to the Ministry of Defense.123
Some in Congress and elsewhere criticized this dearth of lethal security assistance to bolster
Georgias territorial defense capabilities.124 On December 12, 2010, U.S. Senator John McCain
called for the Obama Administration to resume some defensive arms transfers to Georgia,
including early warning radars. During a hearing of the Senate Armed Services Committee on
March 29, 2011, Senator McCain asked whether the United States was providing defensive
weapons to Georgia, and EUCOM Commander Stavridis stated that at this moment we are not
providing them [with] what I would term high-end military defensive weapons. Senator McCain
responded that it is hard for me to understand, since the Russians still occupy territory that is
clearly Georgian territory and continue to threaten Georgia, and yet we're not even giving them
weapons with which to defend themselves. It is not comprehensible.125
120
46
After a meeting between U.S. Members of Congress and Georgian legislators on the sidelines of
the annual meeting of the NATO Parliamentary Assembly in Bucharest, Romania, in mid-October
2011, the U.S. delegation head, Representative Mike Turner, released a statement stating that all
NATO states should look to arms sales with Georgia that can add to the collective defense. A
stronger Georgia is clearly in the interest of all NATO members.126
A report issued in October 2011 by a team led by Senators Jeanne Shaheen and Lindsey Graham
urged that U.S. policy be changed to normalize ... defense relations with Georgia, including
allowing sales of defensive military equipment [which] will encourage other allies to follow suit,
enabling Georgia to resume purchasing armaments from Central European allies.127
On December 31, 2011, President Obama signed into law the National Defense Authorization Act
(NDAA) for FY2012 (P.L. 112-81). Section 1242 called for the Defense Secretary to submit a
plan to Congress for the normalization of U.S. defense cooperation with Georgia, including the
sale of defensive weapons. In a signing statement, the President stated that if the provisions of the
section conflict with his constitutional authority to conduct foreign relations (presumably, in this
case, including his reset policy with Russia), they would be considered non-binding.
(...continued)
Command Budget for Fiscal Year 2012, March 29, 2011.
126
Meeting of US and Georgian Delegations at NATO Parliamentary Assembly, The Messenger, October 11, 2011;
U.S. Congresspersons Release Strong Statement of Support for Georgia in NATO, The Messenger, October 12, 2011.
127
Georgia in the West: A Policy Road Map to Georgias Euro-Atlantic Future, Atlantic Council, October 13, 2011.
47
ammunition. The report announced that the enhanced defense cooperation program would
begin in FY2013 (see below).128
128
U.S. Department of Defense, Report to Congressional Committees on the Department of Defense Plan for Defense
Cooperation with the Republic of Georgia, April 30, 2012.
129
U.S. Department of State, Remarks at Coast Guard Ship Commissioning, June 5, 2012.
130
U.S. Senate. Committee on Armed Services. Hearing to Receive Testimony on U.S. European Command, U.S.
Northern Command, and U.S. Southern Command in Review of the Defense Authorization Request for Fiscal Year
2014 and the Future Years Defense Program, Testimony of Admiral James G. Stavridis, United States Navy,
Commander, United States European Command, March 19, 2013.
48
Obama Administration would look favorably on the sale of air surveillance radars, coastal
surveillance acoustic systems, and small arms ammunition to Georgia.131
The account tables listing country-level data, released on March 21, 2014, as part of the State
Departments Congressional Budget Justification: Department of State, Foreign Operations, and
Related Programs, FY2015, stated that IMET amounted to $1.799 million in FY2013 and an
estimated $1.8 million in FY2014. The Administration requested $1.8 million for FY2015. The
account tables listed $13.672 million in spending for FMF for FY2013 and an estimated $12
million for FY2014. The Administration requested $10 million for FY2015.
The latest joint Defense and State Department report to Congress on foreign military training
stated that 294 Georgian students had completed courses in FY2012 at a cost of about $12
million. Courses involved training on national security strategy, language, combating terrorism,
technical issues related to equipment purchases, interoperability, civilian control of the military,
strategic intelligence, careers, and logistics.132
Troops from all three regional states have served as peacekeepers in the NATO
Kosovo Force (KFOR). As of January 2014, 35 troops from Armenia continued
to serve in KFOR.133
All three regional states have deployed troops to support the International
Security Assistance Force (ISAF) in Afghanistan (see above, Regional Support
for Military Operations in Iraq and Afghanistan).
Armenias Foreign Minister Edvard Nalbandyan reportedly indicated that President Sargisyan did
not attend the NATO summit in Chicago in May 2012 because he knew that the summit would
uphold Azerbaijans territorial integrity, as was subsequently reflected in the summit declaration.
Nalbandyan stated that the declaration not only harmed the negotiation process but also
jeopardize[d] the fragile peace in the region, especially given the unprecedented growth of
Azerbaijans military expenses and bellicose rhetoric.134
131
U.S. Senate, Committee on Armed Services, Hearing on the nomination of Philip M. Breedlove for Commander,
United States European Command and Supreme Allied Commander, Europe, Advance Questions for General Philip M.
Breedlove, USAF, April 11, 2013.
132
U.S. Department of State and U.S. Department of Defense, Foreign Military Training, FY2012-FY2013, Joint
Report to Congress, Volume 1.
133
NATO, Kosovo Force, Troop Contributions, January 1, 2014, at http://www.nato.int/nato_static/assets/pdf/
pdf_2014_01/140107-kfor-placemat-final2.pdf.
134
Mediamax, May 21, 2012.
49
NATO. North Atlantic Council. Riga Summit Declaration, November 29, 2006. Then-Senator Richard Lugar urged
soon granting Georgia a MAP and suggested that NATOs energy security would be facilitated by eventually offering
NATO membership to Azerbaijan and Kazakhstan. Senator Lugar Delivers Remarks at the Riga Summit, Latvia,
Congressional Quarterly Transcripts, November 27, 2006.
136
The White House, January 30, 2012.
137
U.S. Senate, Committee on Foreign Relations, Hearing on Nominations, March 21, 2012.
138
NATO, Chicago Summit Declaration, May 20, 2012.
139
NATO, Joint Press Point by NATO Secretary General Anders Fogh Rasmussen and the Prime Minister of Georgia,
Bidzina Ivanishvili, November 14, 2012.
50
in Brussels, held a week after Ivanishvilis NATO visit, Georgian Defense Minister Alasania
stated that post-election Georgia was now more stable and a stronger and more predictable NATO
partner, and that Georgia would uphold the rule of law. At a follow-on meeting of the NATOGeorgia Commission on December 5, 2012, during the NATO foreign ministerial meeting in
Brussels, Secretary General Rasmussen reiterated that the Alliance would continue to monitor
judicial developments in Georgia, and stressed that NATO looked forward to a still stronger and
closer relationship [with Georgia] in 2013 and beyond.140
At a meeting of the NATO-Georgia Commission on March 19, 2013, the Georgian side reported
on its annual plan for 2013. NATO emissaries reportedly praised the annual plan and offered
assistance for its fulfillment, and urged vying political interests in Georgia to work together to
further the countrys democratization. A North Atlantic Council delegation, led by NATO
Secretary General Anders Fogh Ramussen, visited Tbilisi in late June 2013, and a meeting of the
NATO-Georgia Commission also was held, attended by then-Prime Minister Ivanishvili.
Rasmussen raised concerns about arrests of former Georgian officials and called for Georgia to
further democratize and protect the rights of minority groups and other human rights as part of its
movement toward NATO membership. Ivanishvili reiterated that Georgia was committed to
joining NATO and would continue to support peacekeeping in Afghanistan. A reported major
issue discussed by the NATO-Georgia Commission was the movement of border barriers by
Russian border guards in South Ossetia. In October 2013, Rasmussen called for Russia to remove
fences and other obstacles it was constructing in South Ossetia and to reverse the recognition of
the independence of the breakaway regions. He also announced that Georgia would join NATOs
Response Force (a maritime and special operations rapid-reaction force) in 2015.
At a NATO-Georgia Commission meeting in Brussels in early December 2013, Secretary General
Rasmussen stated that there was the promise of new momentum in military and democratic
reforms in Georgia under the new government, but stated that work remained to be done before
Georgia gains NATO membership. On January 13, 2014, Georgian legislative Speaker Davit
Usupashvili asserted that if NATO does not offer Georgia a MAP at a planned summit in
September 2014, anti-Western forces could be strengthened in the country and political stability
might be undermined. On January 16, 2014, Georgian Prime Minister Irakli Garibashvili
responded to this statement by stating that if there is no MAP now, there will be later, it is not a
principle [issue]. If the question is whether we want it or not, of course, we want it. But if there is
no MAP, it will not create a threat and change our European integration. Observers have pointed
out that polls indicate that popular support is high and may even have increased in favor of NATO
membership.141
The U.S. Congress approved the NATO Freedom Consolidation Act of 2007, signed into law in
April 2007 (P.L. 110-17), to urge NATO to extend a MAP for Georgia and to designate Georgia as
eligible to receive security assistance under the program established by the NATO Participation
Act of 1994 (P.L. 103-447). The statement released by the U.S. delegation to the NATO
Parliamentary Assembly in October 2011 (mentioned above) called for NATO to extend a MAP
for Georgia at the upcoming NATO Summit in Chicago in May 2012. In March 2012, then140
NATO, NATO Foreign Ministers Praise Georgias Commitment to Euro-Atlantic Integration, December 5, 2012;
Opening Remarks by NATO Secretary General Anders Fogh Rasmussen at the NATO-Georgia Commission in Foreign
Ministers Session, December 5, 2012; CEDR, December 6, 2012, Doc. No. CEP-964069; December 7, 2012, Doc. No.
CEP-964050.
141
Georgia Today, January 17, 2014; Liz Fuller, Georgia Sets Sights on NATO Membership Action Plan, RFE/RL,
January 16, 2014.
51
Senator Richard Lugar introduced S. 2177, The NATO Enhancement Act, in the 112th Congress,
which reaffirms an open door policy with respect to the accession of additional countries to
NATO, including NATO aspirant Georgia (a similar bill, H.R. 4243, was introduced in the House
by Representative Michael Turner later in March 2012). The bills expressed the sense of
Congress that the President should lead efforts at the Chicago NATO Summit to provide a clear
roadmap for the granting of a MAP (or other equivalent plan) to Georgia and other aspirants.
However, as mentioned above, Georgia was not offered a MAP at the Chicago NATO summit.
On February 5, 2014, Representative Turner and over three dozen other Members of Congress
wrote a letter to Secretary Kerry urging him to advocate granting a MAP to Georgia at the
scheduled September 2014 NATO Summit. They argued that the prospect of NATO membership
would strengthen democratic institutions and stability and security in the region, while the failure
to reward progress could discourage aspirant countries from pursuing further democratic reforms
and weaken their Euro-Atlantic orientation.
52
County
U.S. Imports
from
Main
Categories of
Imports
U.S. Exports
to
Main
Categories of
Exports
Total
Turnover
Armenia
106.76
aluminum sheets
& foils,a apparel,
& beverages
92.96
poultry,
electronics,
automobiles,
aircraft, jewelry
199.72
Azerbaijan
1,166.46
378.37
automobiles,
aircraft, oil & gas
machinery,
electronics
1,544.83
Georgia
175.58
599.16
automobiles,
poultry, refined
aluminum
774.74
Produced by a Russian firm in Armenia from imported aluminum. Interfax, February 7, 2014.
b.
Mainly from scrap metal. Molly Corso, Georgia: Hunting for Gold in All That Glitters, Eurasianet, April 14,
2011.
53
vying pipeline proposals, the Administration will support the project that brings the most gas,
soonest and most reliably, to those parts of Europe that need it most. At the same time,
Morningstar rejected views that Russia and the United States are competing for influence over
Caspian energy supplies, pointing out that the Administration has formed a Working Group on
Energy under the U.S.-Russia Bilateral Presidential Commission.145 According to some observers,
the construction of Southern Corridor pipelines will bolster the strategic importance to the West
of stability and security in the Caspian region.146
U.S. officials have argued that Azerbaijani gas is critical to the development of the Southern
Corridor.147 In March 2007, Azerbaijan and the United States signed a memorandum of
understanding on energy cooperation that called for discussions on various proposed gas
pipelines. In August 2007, the U.S. Trade Development Administration granted Azerbaijan $1.7
million to fund feasibility studies on building both oil and gas pipelines across the Caspian Sea to
link Central Asia to Azerbaijani pipelines.
145
U.S. House of Representatives, Committee on Foreign Affairs, Subcommittee on Europe and Eurasia, Hearing on
European and Eurasian Energy: Developing Capabilities for Security and Prosperity, Testimony of Ambassador
Richard L. Morningstar, Special Envoy for Eurasian Energy, June 2, 2011. See also U.S. Department of State, Remarks
at The Economist's Investment Energy Summit, Richard Morningstar, Special Envoy for Eurasian Energy, The
Economist Conference, Athens, Greece, March 28, 2012.
146
Sedat Laciner, Turkeys Pipeline Politics, The Journal of Turkish Weekly Online, International Strategic Research
Organization, September 16, 2009.
147
Speech to Plenary Session of Caspian Oil and Gas Conference, Ambassador Richard L. Morningstar, June 8, 2011;
Former U.S. Envoy [Matthew Bryza] Says Gas Project Impossible without Azerbaijan, APA News Agency, March
28, 2012.
54
The August 2008 Russia-Georgia conflict did not result in physical harm to the BTC pipeline or
the SCP. The BTC pipeline was closed due to other causes. The SCP and the small Baku-Supsa
oil pipeline were closed temporarily as a safety precaution. Russian gas shipments via Georgia to
Armenia decreased in volume for a few days at the height of the conflict. Rail shipments of oil by
Azerbaijan to the Kulevi oil terminal (owned by Azerbaijan) on Georgias Black Sea coast were
disrupted temporarily.
At the end of October 2008, the first oil from Kazakhstan started to be pumped through the BTC
pipeline, but a transit price increase by Azerbaijan in 2011 led Kazakhstan to restrict its use of the
BTC. Some Kazakh oil also is barged to Azerbaijan to be shipped by rail to Georgias Black Sea
port of Kulevi, owned by Socar (Kazakhstans port at Batumi, Georgia, mostly ships dry goods).
Kazakhstan and Azerbaijan continue talks on expanding the barging of oil to the BTC pipeline.
By agreement, about 80,000 bpd are planned to be barged from Kazakhstan to the BTC pipeline
or rail lines in 2014. Some Turkmen oil began to be transported through the BTC pipeline in June
2010. Some observers argue that the completion of the BTC and SCP boosted awareness in the
European Union and the United States of the strategic importance of the South Caucasus.148
55
Russias Gazprom gas firm signed agreements that SOCAR would supply 17.7 billion cubic feet
of gas per year to Russia beginning in 2010. The gas would be transported by a 140-mile gas
pipeline from Baku to Russias Dagestan Republic that was used until 2007 to supply Azerbaijan
with up to 283 billion cubic feet of gas per year. During a visit by then-President Medvedev to
Azerbaijan in September 2010, the two countries agreed that Azerbaijan would provide up to 35.4
billion cubic feet of gas per year beginning in 2011 (this increase had been under consideration
since the signing of the 2009 accord). President Aliyev stressed that this small supply agreement
would not jeopardize plans to supply gas for Nabucco, since Azerbaijan possessed huge gas
reserves.149
As another alternative to gas shipments through Turkey, a memorandum of understanding was
signed by Azerbaijan, Romania, and Georgia in April 2010 to transport liquefied natural gas
(LNG) from Azerbaijan to the EU through Georgia and Romania. This Azerbaijan-GeorgiaRomania-Interconnection (AGRI) project envisions the construction of a gas pipeline from
Azerbaijan to the Georgian port of Kalevi, where the gas would be liquefied, shipped across the
Black Sea, and regasified at the Romanian port of Constanta. The output is expected to be 247
billion cubic feet per year, with 71 billion cubic feet of the gas used by Romania and the rest by
other EU countries. The presidents of the three countries (and the prime minister of Hungary,
which joined the project) met in Baku on September 15, 2010, to sign the Baku Declaration of
political support for the project.
Some of the tensions between Turkey and Azerbaijan involving energy issues appeared to ease in
June 2010, during President Aliyevs visit to Turkey, when the two countries signed accords on
the sale and transportation of Azerbaijani natural gas to Turkey and to other countries via Turkey.
A memorandum of understanding permitting Azerbaijan to conclude direct sales with Greece,
Bulgaria, and Syria involving gas transiting Turkey was signed.
In January 2011, President Aliyev and the President of the European Commission, Jose Manuel
Barroso, signed a joint declaration committing Azerbaijan to supplying substantial volumes of gas
over the long term to the European Union. Nonetheless, some analysts raised concerns that there
would not be enough Azerbaijani gas to fill the proposed ITGI and Nabucco pipelines (deliveries
would be 406 billion cubic feet per year for ITGI and 158 billion-459 billion cubic feet per year
for Nabucco) and to provide for the proposed AGRI project without a trans-Caspian gas pipeline
or participation by Iran or Iraq. Others suggested that Azerbaijan would be able to supply at least
most of the needed gas for both the ITGI and Nabucco pipelines and the AGRI project, including
because of recent results from exploratory drilling off the Caspian seacoast.150
Meeting an October 1, 2011, deadline, the Shah Deniz Export Negotiating Teamled by the State
Oil Company of Azerbaijan (SOCAR) and including BP, Statoil, and Totalreceived what were
then claimed to be final proposals for pipelines to export gas from the second phase development
of the Shah Deniz offshore oil and gas fields. Proposals were received from consortia backing the
ITGI, Nabucco, and Trans-Adriatic Pipeline (TAP; from Turkey through Greece, Albania, and the
Adriatic Sea to Italy) projects, as well as from BP, which reportedly proposed building an 808mile South East Europe Pipeline (SEEP) from western Turkey through Bulgaria, Romania, and
Hungary to Austria.
149
150
56
On October 25, 2011, Azerbaijan and Turkey announced that they had signed accords on the final
terms for the transit of Shah Deniz phase 2 gas through Turkey. The agreementssigned during
President Aliyevs visit to Turkeyspecified that 565-706 billion cubic feet of gas would transit
Turkey, of which 212 billion cubic feet would be available for Turkeys domestic use. Another
accord provided for the possible construction of a new Trans-Anatolian Pipeline (TANAP; from
the Georgian-Turkish border to the Turkish-Bulgarian border), so that the gas from Shah Deniz
Phase 2 would not have to go through the existing Turkish pipeline system. This pipeline was
envisaged at that time to possibly link to BPs proposed SEEP, to TAP, or to a new version of the
Nabucco pipeline termed Nabucco West (stretching from the Turkish border to Austria).
In late December 2011, the Azerbaijani and Turkish governments signed a memorandum of
understanding on setting up a consortium involving SOCAR, the Turkish state-owned TPAO
energy firm, and TPAOs pipeline subsidiary, BOTAS, to construct TANAP. An intergovernmental agreement was signed by President Aliyev and Prime Minister Erdogan in June
2012. SOCAR is designated initially to hold an 80% share in the consortium, although other
members are being invited to join the consortium and to hold 29% of the shares. The first stage,
with a capacity of 565 bcf per year, is planned to be completed in 2018.
In May 2012, the Nabucco consortium submitted new pipeline proposals to the Shah Deniz
consortium, reportedly including the original route as well as the shorter Nabucco West route. The
Shah Deniz Export Negotiating Team reportedly indicated in February 2012 that it preferred the
TAP proposal over the ITGI pipeline proposal. In mid-2012, it rejected SEEP, leaving TAP and
Nabucco West as the choices. In late March 2013, the Nabucco and TAP consortiums submitted
refined proposals to the Shah Deniz Team, which has indicated that it will make a final decision
about the pipeline in June 2013.
In late 2012, Russia finalized arrangements with transit states for the construction of the South
Stream gas pipeline, with a capacity of 2.2 bcf per year, under the Black Sea to European
markets, and began construction of the onshore portion in Russia in December 2012. The
undersea portion will extend nearly 600 miles. From Bulgaria, the pipeline is planned to transit
Serbia, Hungary, and Slovenia to Austria. According to some analysts, the pipeline is not
economically viable, but is being proposed by Russia to counter proposals to build the Nabucco
West and TAP pipelines and perhaps a trans-Caspian pipeline, so that Russia may maintain a
dominant gas presence in Europe.
57
Herzegovina, and Croatia (half the initial capacity of TAP). European Commission (EC) Energy
Commissioner Gnther Oettinger has stressed that the EC push to build interconnectors between
European pipelines also will enable TAP-supplied gas to reach other states such as Bulgaria and
Hungary that are vulnerable to Russian gas supply cut-offs.151
The decision on TAP was a prelude to a final investment decision made on December 17, 2013,
on the phase II development of Azerbaijans Shah Deniz gas field, anticipated to cost $28
billion.152 Given the expense of developing Shah Deniz phase II, the cost of transporting the gas
and the final market price are critical to the economic viability of phase II development.
Construction is planned to begin in 2015 for completion in 2019.
Implications of TAP
For Europe: Some analysts argue that since TAPs initial capacity of approximately 350 bcf
represents about 2% of the EUs current gas consumption, and TAPs later deliveries of 700 bcf
would represent at the most only a percentage or two more, TAP will not appreciably reduce
reliance on Russian gas. Nevertheless, observers have commended that TAP will assist Europe in
diversifying its supply sources beyond reliance on Russia, will help Greece to strengthen its
economy, and could encourage cooperation between historic rivals Greece and Turkey.153 And,
TAP will result in added investment and will for the first time include Albania in European gas
transit routes.154 In addition, Austrias OMV stated that in the face of the negative decision on
Nabucco West, OMV [will] seek to provide European gas to European consumers and to
develop opportunities based on alternative gas sources, possibly referring to shale gas or Black
Sea exploration.155 Similarly, while voicing disappointment about the loss of the Nabucco West
pipeline, Romanian officials stated that the country instead would pursue a policy of developing
indigenous sources of supply and would further develop the AGRI proposal.156 The EU also has
stated that it will continue talks with Turkmenistan on a possible trans-Caspian gas pipeline that
could increase gas transit through the Southern Corridor, thereby enhancing European energy
security (see below).
For the United States: The State Department welcomed the decision on TAP as furthering the
U.S.-supported goal of a Southern Corridor bringing new sources of gas to Europe, thereby
strengthening European and global energy security.157
151
Statement of Gnther H. Oettinger, European Commissioner for Energy: The Shah Deniz Decision, More Gas for
Europe, Natural Gas Europe, July 1, 2013, at http://www.naturalgaseurope.com/shah-deniz-decision-oettinger. See
also Matthew Bryza and David Koranyi, A Tale of Two Pipelines: Why TAP has Won the Day, Natural Gas Europe,
July 2, 2013.
152
Shah Deniz Shareholders Announce FID for SD2 Project, FSU Oil & Gas Monitor, December 18, 2013.
153
Russian Gas Pipeline Could Doom Europes Nabucco Plan, Reuters, May 28, 2013.
154
H.K. Tzanis, Trans-Adriatic Pipeline to Bring Azeri Gas to Europe, Southeast European Times (Athens), July 3,
2013.
155
Cristian Campeanu, How To Get Rid of Russian Gas Dependence After Nabucco Failure? Libera, July 4, 2013.
156
Oana Voncick, Basescu: I Believe That Romania Will Be Capable To Export Gas From the Black Sea in 2018 or
2019, Libera, July 5, 2013; Open Source Center, Europe: Daily Report, July 23, 2013, Doc. No. EUN-13547005.
157
U.S. Department of State, Press Statement: Selection of Pipeline Route for the Southern Gas Corridor, June 28,
2013.
58
For Azerbaijan: The TAP decision should provide a boost to the economy as European energy
markets are considered by some observers to be more predictable and manageable than other
possible export markets, such as Russia.158 These observers also claim that the completion of TAP
will bolster Azerbaijans Euro-Atlantic orientation. One pro-government Azerbaijani legislator
asserted that Europe should stop ignoring the NK conflict, since a renewal of fighting could
threaten Europes energy security.159
Azerbaijan Warns Of EU Double Standards Over Its Need For Reliable Pipeline Gas, Caspian Review, July 3,
2013; A Tale of Two Pipelines: Why TAP has Won the Day, Natural Gas Europe, July 2, 2013.
159
Azerbaijan Warns Of EU Double Standards Over Its Need For Reliable Pipeline Gas, Caspian Review, July 3,
2013.
160
European Commission, Press Release: EU Starts Negotiations on Caspian Pipeline to Bring Gas to Europe,
September 12, 2011.
161
CEDR, April 4, 2012, Doc. No. CEP-950050.
162
Baku News, September 18, 2012.
59
The United States has supported building a trans-Caspian pipeline and stated that no other
country should be able to veto a decision by Azerbaijan and Turkmenistan to build such a
pipeline. Many observers suggest that the continuing Azerbaijan-Turkmenistan dispute over
border delineation in the Caspian Sea and Turkmenistans reluctance to sign production sharing
agreements with Western energy firms remain factors hindering the building of such a pipeline.
60
Expressing the sense of the Senate on the continuing relationship between the United States and
Georgia. Introduced on December 11, 2013. Referred to the Committee on Foreign Relations.
Declares U.S. support for Georgias territorial integrity and concern over the occupation of
Abkhazia and South Ossetia; encourages enhanced defense cooperation with Georgia; reaffirms
support for Georgias NATO membership aspirations; commends Georgias ongoing support in
Afghanistan; commends Georgia for holding a peaceful and democratic presidential election; and
encourages Georgia to protect the rights of the political opposition and to refrain from politically
motivated arrests.
P.L. 113-76
H.R. 3547 (Lamar), Consolidated Appropriations Act, 2014. Introduced on November 20, 2013.
Passed the House on December 2, 2013. Passed the Senate on December 12, 2013. House agreed
to the Senate amendment on January 15, 2014. Senate concurred in the House amendment on
January 16, 2014. Signed into law on January 17, 2014. Section 7071 states that funds
appropriated to Armenia, Azerbaijan, and Georgia (and others designated by the European Union
to be Eastern Partnership countries) shall be made available to advance the signing and
implementation of Association Agreements, trade agreements, and visa liberalization agreements
with the European Union (EU), and to reduce the vulnerability of the states to external pressure
not to enter into such accords with the EU. Also calls for a report assessing whether Russia is
erecting non-tariff barriers against imports of goods from Armenia, Azerbaijan, and Georgia (and
other Eastern Partnership countries), and a description of actions by the U.S. government to
ensure that the countries maintain full sovereignty in their foreign policy decision-making. Also
calls for funds to be made available for democracy and rule of law programs in Armenia,
Azerbaijan, and Georgia (and other Soviet successor states), and for a report to be submitted on a
multi-year strategy for such programs. Also calls for a description of steps taken to assist in the
restoration of the territorial integrity of Georgia.
H.Res. 402 (Engel)
Supporting the European Aspirations of the Peoples of the European Unions Eastern Partnership
Countries. Introduced on November 12, 2013. Ordered to be reported by the Committee on
Foreign Affairs, November 20, 2013. The bill supports the European aspirations of the peoples of
the Eastern Partnership countries, calls on Russia to respect the rights of the states to sign
Association Agreements with the European Union, applauds the significant progress of Ukraine,
Moldova, and Georgia in adopting democratic norms, and urges the State Department to continue
to support the rights of Ukraine, Moldova, and Georgia to enter into voluntary partnerships, to
support reforms in Eastern Partnership countries which will enable them to meet the conditions
for closer ties with the EU, and to support reforms making them more democratic, prosperous,
and secure.
H.Res. 284 (Turner)
Expressing the sense of the House of Representatives with respect to promoting energy security
of European allies through opening up the Southern Gas Corridor. H.Res. 284 was introduced on
June 27, 2013, and was forwarded by the Subcommittee on Europe, Eurasia, and Emerging
Threats to the Committee on Foreign Affairs (Amended) by Unanimous Consent on September
19, 2013.
H.Res. 227 (Valadao)
61
Calling on the President to work toward equitable, constructive, stable, and durable ArmenianTurkish relations based upon the Republic of Turkeys full acknowledgment of the facts and
ongoing consequences of the Armenian Genocide, and a fair, just, and comprehensive
international resolution of this crime against humanity. Introduced on May 20, 2013, and referred
to the Committee on Foreign Affairs. Referred to the Subcommittee on Europe, Eurasia, and
Emerging Threats on June 7, 2013.
S. 1548 (Durbin)
Haiti and Armenia Reforestation Act of 2013. Introduced on September 25, 2013, and referred to
the Committee on Foreign Relations. To provide assistance to the Government of Haiti and the
Government of Armenia to develop and implement, or improve, nationally appropriate policies
and actions to reduce deforestation and forest degradation and improve forest management and
natural regeneration.
H.R. 1960 (McKeon)
National Defense Authorization Act for Fiscal Year 2014. Introduced on May 14, 2013. Passed
the House on June 14, 2013 (H.Rept. 113-102). Placed on the Senate Legislative Calendar on
June 14, 2013. Section 1244, a statement of Congress on defense cooperation with Georgia, raises
concerns that problems of democratization in Georgia could harm bilateral political, economic,
and security cooperation.
South Caucasus
Country
Armenia
FY1992FY2010
Budgeted
Aida
Total
FY2012
Actualb
FY2013
Actualb
FY2014
Estimateb
FY2015
Requestb
1,951.83
44.42
44.23
35.665
26.124
24.7
975.75
26.4
20.87
15.431
13.526
12.7
3,369.33
87.1
85.49
67.168
56.747
53.566
6,365.73c
157.92
150.59
118.264
96.397
90.966
16
27
35
28
24
23
Azerbaijan
Georgia
FY2011
Actualb
Percent of Eurasian
Aid (including Central
Asia)
Sources: U.S. Department of State, Office of the Coordinator of Assistance to Europe and Eurasia, all agency
funding for FY1992-FY2012; U.S. Department of State, Congressional Budget Justification: Department of State,
Foreign Operations, and Related Programs, FY2015, March 4, 2014 (the account tables listing country assistance
were added on March 21, 2014).
a.
Assistance to Europe, Eurasia, and Central Asia (AEECA) and Agency budgets.
b.
FY2011 and FY2012 data include AEECA, Foreign Military Financing (FMF), International Military Education
and Training (IMET), Global Health Programs (GHP), International Narcotics Control and Law Enforcement
(INCLE), and Nonproliferation, Anti-terrorism, Demining, and Related Programs (NADR) assistance. For
FY2013-FY2015, AEECA programs were included as part of Economic Support Funds (ESF), GHP, and
62
INCLE. FY2011-FY2015 data do not include Defense or Energy Department funding, funding for exchanges,
Food aid, or Peace Corps programs. For FY2013-2015, the account tables from the Congressional Budget
Justification do not break down NADR funding by country; the country annex will include complete
Function 150 assistance totals that include NADR. Percentage of funding excludes some Eurasian regional
programs involving the South Caucasus.
c.
63
FY1992
74.97
1.8
FY1993
172.39
FY1994
159.1
FY1995
FY1996
FY1997
FY1998
FY1999
FY2000
FY2001
114.38
135.23
98.72
116.14
91.86
117.19
102.47
37.96
48.26
8.42
34.52
26.01
29.96
16.77
41.2
47.22
Georgia
29.16
169.01
93.34
105.26
94.41
28.29
123.33
119.51
Regional
0.0
0.0
0.0
0.0
0.0
0.0
8.3
0.0
2.0
4.4
105.93
349.82
286.96
245.65
143.78
288.97
258.59
281.65
306.36
Total
259.6
124.5
151.23
Source: Derived from U.S. Department of State, Office of the Coordinator for Europe and Eurasia.
Notes: Includes all agencies and accounts.
Table 4. U.S. Assistance to the South Caucasus by Year, FY2002-FY2010 (and Totals, FY1992-FY2010)
(millions of current dollars)
Total
Country
Armenia
FY2002
FY2003
FY2004
FY2005
FY2006
FY2007
FY2008
FY2009
FY2010
(FY1992FY2010)
112.74
105.08
93.19
91.01
88.17
71.91
78.92
69.2
59.16
1,951.83
68.89
68.63
79.48
80.11
84.24
79.38
80.05
76.21
66.65
975.75
Georgia
150.44
150.64
148.29
147.35
131.58
895.67
423.87
154.36
3,369.33
Regional
2.3
1.99
17.71
2.03
11.1
3.0
1.03
12.94
2.03
68.82
326.34
338.67
302.25
330.86
285.87
1055.67
582.22
Azerbaijan
Total
334.37
129.1
Source: Derived from U.S. Department of State, Office of the Coordinator for Europe and Eurasia.
Notes: Includes all agencies and accounts.
CRS-64
282.2
6,365.73
Budgeted
1998
8.6
1999
3.5
2000
2.0
2001
4.4
2002
2.3
2003
1.987
2004
2.0
2005
2.43
2006
1.98
2007
2.509
2008
2.0
2009
1.996
2010
2.0
2011
2.0
2012
2.0
Prior-Year De-obligated
-0.708
Total Budgeted
40.994
Source: Source: State Department. Office of the Coordinator of U.S. Assistance to Europe and Eurasia.
Note: Does not include $480,000 in FY2009 AEECA funding provided for a Track II diplomacy project to
increase cross-border communication and understanding among Armenians, Azeris and Karabakhis, with the goal
of fostering reconciliation in the NK conflict. Does not include $223,000 in FY2010 AEECA Performance Funds
provided for de-mining activities in NK.
65
Source: CRS.
Notes: Administrative borders of the former Nagorno Karabakh Autonomous Region.
66